Fed Officials Still Expect Rate Cuts Despite Hotter Inflation, Though Timing Uncertain

Two Fed officials (John Williams and Susan Collins) reiterated forecasts for rate cuts later this year despite higher inflation readings recently.

Williams still expects inflation to gradually decline to 2% target, though acknowledges "bumps along the way".

Collins said outlook unchanged, but hotter inflation means less urgency for rate cuts now. Still expects cuts in 2024.

Markets reacted negatively to hotter inflation data, now pricing in fewer rate cuts this year.

Both officials expect uneven monthly inflation figures before steady move down to 2% target.