MNI BRIEF: Fed's Mester Sees 3 Cuts In 2024, But Could Be 2

Federal Reserve Bank of Cleveland President Loretta Mester said Tuesday she continues to expect three interest rate cuts this year if the economy evolves as expected, but two cuts could also be appropriate.

"Three is still reasonable, but you know, it's close call -- three, two," she told reporters after speaking at a National Association for Business Economics event in Cleveland. More data is needed to discern whether the firmer-than-expected inflation reports so far this year "were a detour or whether they're the new kind of path."

In gauging whether inflation is on a sustained path toward 2%, Mester said she's looking for continued progress on goods, housing and non-housing services prices and how higher oil prices could affect inflation expectations. (See: MNI INTERVIEW: US Manufacturing Rebounds, Price Hikes Concern)

"In June we'll have more data, so I wouldn't rule that out. We just need to see more evidence that inflation on that sustainable downward path to 2%," she said.