Boyle, Whitehouse Call on Federal Reserve to Begin Cutting Interest Rates
Budget Committee Democratic Leaders Highlight Dangers of Elevated Interest Rates for American Families, Urge the Fed to Reverse Course
Washington, D.C. – Today, House Budget Committee Ranking Member Brendan F. Boyle and Senate Budget Committee Chairman Sheldon Whitehouse sent a letter to Federal Reserve Board Chair Jerome Powell ahead of this week’s Federal Open Market Committee (FOMC) meeting, expressing concern over the harmful economic effects of prolonged elevated interest rates and calling on the Fed to begin lowering rates.
“Excessively tight monetary policy may jeopardize the strong job market that the U.S. has enjoyed over the last several years,” wrote Ranking Member Boyle and Chairman Whitehouse. “The U.S. economy has achieved an apparent soft landing with inflation falling sharply and continued steady job growth. Lowering rates now will ensure that we do not cause unnecessary and harmful economic damage.”
In the letter, the lawmakers also warned that elevated interest rates are needlessly raising housing costs for families: “Not only are high rental costs overstating inflation numbers, keeping rates higher for longer will do nothing to solve the housing crisis, and instead may be exacerbating it by increasing the cost of new housing construction, restricting the supply of listings, and making it more expensive for families to buy new homes.”
“We believe that the Federal Reserve must begin to cut rates as soon as the next Federal Open Market Committee meeting. Doing so is warranted by the data, will preserve the economic progress that was so hard fought, and will allow workers and families to enjoy the benefits of a strong economy,” Boyle and Whitehouse concluded.
Ranking Member Boyle has consistently warned of the risks that the Fed’s aggressive interest rate hikes pose to our economy. In May 2023, he led his colleagues in both chambers of Congress in a letter to Chair Powell, warning that prolonged interest rate increases could throw millions of Americans out of work and crush small businesses. In July 2023, after the Fed raised rates for the 11th time, he penned an op-ed with Rep. Val Hoyle (D-OR) pointing out the danger of an unnecessary over-correction to American workers. In January, he firmly called for the Fed to respect its dual mandate and begin cutting rates in 2024.
The full text of the letter is available HERE.
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