MNI BRIEF: Fed’s Daly Expects More Rate Cuts Ahead

MNI (WASHINGTON) - The Federal Reserve will keep cutting interest rates as inflation continues trending lower, San Francisco Fed President Mary Daly said Monday. 

“I expect additional cuts going forward to continue as inflation comes down,” she said during a Q&A with The Wall Street Journal. 

She said the Fed’s 50 basis point rate cut last month was an effort to “right size” policy that was a too tight. The Fed’s goal now is to “create the conditions for a durable expansion,” Daly said. (See MNI INTERVIEW: More Cuts Before Fed Fine-Tunes Neutral-Mester)

Daly said Fed policy is still restrictive and the central bank wants to avoid undue damage to the economy or the labor market. 

"To get this soft landing accomplished and to have a durable expansion, we have to adjust the policy rate is inflation falls," she said.