MNI BRIEF: Fed's Harker Says May Rate Cut Possible

Federal Reserve Bank of Philadelphia President Pat Harker said Thursday it is possible it could just take a couple more months of data before he supports easing interest rate, adding that a rate cut in May is possible but more likely to come later.

"I'm not looking for a lot more evidence. I just want to get a couple more months under our belt, at least [data for the month of] March," he said. "In my view, I don't see why we would do anything in March." Asked about cutting rates in May, he said: "It's possible. I wouldn't take it off the table, for sure." (See: MNI INTERVIEW: Fed Could Cut As Early As June - Quarles)

"If PCE inflation starts to come in cooler than we think, and the labor market starts to signal even more that it is cooling more than we think right now, then I wouldn't take it off the table," he said about a May rate cut, in Q&A at a University of Delaware event. "It's not my forecast right now but I wouldn't say no." Once the rate-cut process begins, Harker suggested support for a steady, slow easing, maybe at every other FOMC meeting and starting in the second half of the year, depending on incoming data. "We are close to cutting. Just give us a couple meetings."