Fed's Goolsbee: Rates can go down 'fair bit more' if inflation improves

February 13, 2026 - 19:14

Federal Reserve Bank of Chicago President Austan Goolsbee indicated that interest rates could see substantial reductions if inflation continues to show sustained improvement. His comments follow recent economic data showing a cooling labor market and inflation rising less than anticipated in January.

Goolsbee emphasized the central bank's dual mandate of price stability and maximum employment, suggesting the current policy approach is appropriately restrictive. He pointed to the latest Consumer Price Index figures and jobs report as positive signs that the economy is moving toward a better balance.

The official discussed the path toward a neutral policy stance, where interest rates neither stimulate nor restrict economic growth. While not committing to a specific timeline, Goolsbee underscored that the Fed's future decisions will be strictly dependent on incoming economic data. He stressed that consistent evidence of inflation trending downward toward the Fed's two percent target would pave the way for a notable easing of monetary policy. This outlook provides a measure of optimism for markets and consumers anticipating relief from high borrowing costs.