Federal Reserve officials, including Chair Jerome Powell and Cleveland Fed President Loretta Mester, have indicated that the central bank is on track to cut interest rates this year. Powell has cited a slowing inflation and a healthy economy as reasons for the potential rate cuts, while seeking more data before making a final decision. Mester has emphasized a gradual pace for the rate cuts, noting that wage gains are still too high for achieving the 2% inflation target. She also mentioned that growth and employment are expected to moderate, and the labor market could cool faster than expected. Mester is open to rate cuts if there's clear evidence of further easing inflation, and she expects up to three rate cuts this year. However, she does not want to commit to a timing for the rate cuts and sees no urgency to slow the pace of balance-sheet reduction at this time.
Fed's Mester Sees Three Rate Cuts This Year, No Need To Rush https://t.co/dyXof27YvH
Fed’s Mester: She Still Expects Three Rate Cuts This Year - Not Necessary To Move Only At Meetings With Forecasts - No Urgency To Slow Pace Of Balance-Sheet Reduction Now - Don't Feel There's Any Need To Rush Rate Cuts
❖ MESTER: DOESN’T WANT TO OFFER TIMING ON RATE CUT
Fed's Mester open to rate cuts if clear inflation is easing further https://t.co/ThZVG2cvbb https://t.co/WNAaGrC6J1
FED'S MESTER: DISCOUNT WINDOW SHOULD NOT HAVE STIGMA ATTACHED TO IT
🔴 FED’S MESTER: HIGHER PRODUCTIVITY LEVELS MAY CHANGE WAGE-INFLATION CALCULUS.
🔴 FED’S MESTER: WAGE GAINS STILL TOO HIGH FOR GETTING TO 2% INFLATION.
❖ MESTER: IF INFLATION DOESN’T FALL FED CAN MAINTAIN CURRENT POLICY
🔴 FED’S MESTER: WE MUST BE ATTENTIVE TO RISK THAT THE LABOR MARKET WILL COOL FASTER-THAN-EXPECTED.
🔴 FED’S MESTER: I SEE GROWTH AND EMPLOYMENT MODERATING THIS YEAR.
❖ MESTER: WHEN FED CUTS RATES WILL LIKELY BE AT GRADUAL PACE
Federal Reserve on track to cut rates this year: What it means for you https://t.co/IkXvSVMMQt
When will the Fed cut rates? More data needed, Powell says https://t.co/oNfcdpfyA9 https://t.co/xsrc4IfX2N
Powell: Federal Reserve on track to cut rates this year with inflation slowing and economy healthy https://t.co/viheqTcXSG