04:00 PM EST, 12/02/2024 (MT Newswires) -- The Federal Reserve's path toward a 2% inflation rate appears bumpy, but sustainable, as economic growth and the labor market continue to cool, Federal Reserve Bank of Atlanta President Raphael Bostic said Monday.

Inflation as tracked by personal consumption expenditures has eased over the last six months, "but not in a rapid, straight-line fashion," Bostic said in an essay posted to the Fed branch's website. Core inflation that excludes volatile food and energy prices has hovered stubbornly around 2.6% and 2.7%, he said.

While there are upside risks to price stability, particularly amid elevated shelter costs, Bostic said he does not view the recent bumpiness "as a sign that progress toward price stability has completely stalled."

When excluding housing costs, core inflation, as measured by the consumer price index, rose at a 2.3% annual rate in October, versus a 3.3% rate including shelter, according to Bostic, who is a Federal Open Market Committee voting member this year. Bostic said he is "not alarmed by the relative strength of shelter prices" as easing rent growth is expected to eventually drive inflation down.

Bostic isn't seeing signs of an imminent surge in economic energy. "Economic growth has been stronger than expected in recent quarters, yes. But the data and our contacts tell us that economic growth, like the labor market, is cooling, and I expect that to continue," he said.

"Despite the conclusion of a tense presidential election, geopolitical uncertainties linger at home and abroad, and could generate renewed inflationary pressures," he said. "Given the many twists and turns of the past few years, we need to be on alert for whatever surprises emerge."

Still, Bostic said his base case remains that the Fed is on track to reach its 2% inflation objective, and that he will "do whatever it takes to make sure we get there."

"The path ahead for monetary policy is not preset," he said. "In making judgments about what this path should look like, my strategy will be to look to the incoming data, information from our portfolio of surveys, the balance of risks, and input from our business contacts. Much hard work lies before us. We stand ready."