According to Bank of America Corp ( BAC ). CEO Brian Moynihan, Federal Reserve policy should remain steady despite concerns about economic uncertainty. On Wednesday, he said the Fed should be “a little cautious about cutting,” citing economic growth of around 2% and ongoing tariff adjustments.

“It would seem that maybe they'd want to hold on to the firepower that they've built up over the last year or so,” Moynihan told CNBC during a “Squawk Box” interview. He added, “They shouldn't be premature to try to boost the economy when it's growing at 2%.”

What Happened: Moynihan described the 2% GDP growth projection as “trend growth,” noting that such expansion aligns with economic targets following the financial crisis.

He emphasized that despite rising concerns about inflation and slowing confidence levels, spending data indicates economic resilience. “We see the consumer continue to be solid, and that should bode well for the economy,” he said.

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On the broader economic picture, Moynihan acknowledged that President Donald Trump’s tariffs would likely reduce growth by about 0.4 percentage points in the near term, CNBC reports. Despite this, he remained confident that the economy will stabilize.

“Right now, we're not talking about what could happen,” Moynihan said. “We're talking about what is happening. The consumer continues to spend pretty strongly for the first part of this year.”

Why It Matters: Consumer behavior data from BofA Securities supports Moynihan’s optimism. A recent survey by BofA Securities showed an increase in home improvement spending expectations from 27% last year to 31% in March 2025, the highest since May 2024. Plans for family growth have also improved, with intentions to have a baby rising from 9% to 12%.

Meanwhile, The Conference Board Consumer Confidence Index fell 7 points to 98.3 in February, its steepest decline since August 2021. Yet, consumer spending remains consistent across various sectors.

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Image created using artificial intelligence via Midjourney.