San Francisco Fed Pres. Mary Daly is speaking and says that she:
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Supported rate cut
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Rate cut was appropriate
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Still have inflation above target, need to get it down
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Labor market has softened quite a bit
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Need to keep policy modestly restrictive
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Open mind on December
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50 bps of cuts this year makes Fed better-positioned
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Need to make decision that balances risks
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Not a more divided Fed than before
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Wouldn’t even use the word ‘divided’
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Disagreement is usually what you see when world is uncertain.
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Everyone should 1 of the FOMC to debate and disagree.
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Government data is the only data we get.
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Looking ahead requires talking with people.
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We have less information than used to, but can still make a decision as needed
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Labor market doesn’t look like it’s on a precipice
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Will there was a risk, inflation is is still printing around 3%
The Fed cut rates by 100 basis points in 2024. It may be that they cut by 50 basis points in 2025.
The Fed is currently driving in a fog with less data. That could lead to mistakes if they don’t see something. I am sure the Fed is doing all it can to drive through the fog by getting information from other sources. The Fed is closer to neutral that they were 2 cuts ago.
inflation may be lower than expectations but it is still at 3%
