Atlanta Federal Reserve President Raphael Bostic signaled Wednesday that he is ready to start lowering interest rates even though inflation is still running above the central bank’s target.

Previously one of the more hawkish policymakers, or in favor of tighter policy to fight inflation, Bostic noted that his focus is shifting more toward the employment side of the Fed’s mandate as signs increase of labor market softening.

“I believe we cannot wait until inflation has actually fallen all the way to 2 percent to begin removing restriction because that would risk labor market disruptions that could inflict unnecessary pain and suffering,” he wrote in a message posted on the Atlanta Fed’s website.

The Fed’s preferred measure showed inflation running at a 2.5% rate in July, and just a slightly higher 2.6% core rate when excluding food and energy. Bostic did not specify how much or when he thinks the Fed should start easing.

However, the missive comes with markets already widely expecting the central bank’s Federal Open Market Committee to cut its benchmark borrowing rate by at least a quarter percentage point when it meets Sept. 17-18.

As an FOMC voting member this year, Bostic’s views carry extra weight and add another level of assurance that the Fed will enact its first easing since the emergency measures it took more than four years ago in the early days of the Covid crisis.

His comments also come two days before what is expected to be a pivotal nonfarm payrolls report as most economists see the labor market losing momentum. Bostic said his experiences with business leaders in the Atlanta area reflect that concern.

“Rest assured, I do not sense a looming crash or panic among business contacts. However, the data and our grassroots feedback describe an economy and labor market losing momentum,” he said. “The upside to this is that the slowdown in activity is feeding a continuing, welcome decline in the pace of inflation.”

Indeed, he cited multiple factors indicating that inflation is progressing convincingly back to the Fed’s target as the labor market moderates.

“Given the circumstances before us — eroding pricing power and a cooling labor market — I’ve rebalanced my focus toward both sides of the dual mandate for the first time since early 2021,” he said.