Analyst: It's not surprising that Federal Reserve officials have disagreements about the neutral interest rate

On November 22, in this week's speech, Chicago Federal Reserve Chairman Austen Goolsbee and Federal Reserve Board Member Michelle Bowman expressed starkly different views on the theoretical neutral interest rate level. The neutral interest rate is the level that allows the Fed to balance all economic goals. Goolsbee emphasized that the Fed still needs to further cut interest rates to reach this level - he called this rate "far below our current level". Meanwhile, Bowman stated, "We may be closer to a neutral policy stance than we currently think." Will Compernolle of FHN Financial pointed out that given in September's forecast, anonymous estimates from Fed officials put the range of neutral interest rates between 2.375% and 3.75%, such divergence is not surprising.