Kugler - Cuts May Be Appropriate At Some Point

Fed Governor Kugler (permanent voter) has given remarks for the first time since being sworn in last year, offering perhaps a dovish leaning stance compared to the broad FOMC spectrum but certainly not the most dovish.

• She notes it may be appropriate to cut rates "at some point".
• There has been "great progress" on inflation and she's "optimistic" it may continue. She expects consumption to moderate but unexpected consumer strength could slow the inflation path.
• "We have seen less—though still meaningful—progress on services inflation, but there are reasons for optimism."
• "At some point, the continued cooling of inflation and labor markets may make it appropriate to reduce the target range for the federal funds rate. On the other hand, if progress on disinflation stalls, it may be appropriate to hold the target range steady at its current level for longer to ensure continued progress on our dual mandate."
• "In summary, I am pleased by the progress on inflation, and optimistic it will continue, but I will be watching the economic data closely to verify the continuation of this progress."