MNI: Fed's Daly Says Further More Rate Cuts Likely Needed

Federal Reserve Bank of San Francisco President Mary Daly said Wednesday she "fully supported" last week's 25 basis point cut, adding that more cuts probably lie ahead.

"It is likely that further policy adjustments will be needed as we work to restore price stability while providing needed support to the labor market," Daly said according to prepared remarks. 

Daly pointed to the Fed's most recent Summary of Economic Projections released last week that showed that officials in general expect additional reductions in rates this year and next.

"But these are projections, not promises, and making good decisions will require us to anchor on our objectives, assess the tradeoffs, and decide, again and again," she said in remarks to the University of Utah’s David Eccles School of Business. (See: MNI INTERVIEW: Fed Right To Remain Cautious On Rate Cuts-Kohn) 

Last week's FOMC cut was justified by the data, she said. 

"The risks to the economy had shifted, and it was time to act," said Daly. "Growth, consumer spending, and the labor market had slowed, and inflation had risen less than expected, remaining largely confined to sectors directly affected by tariffs."