| | | December 1/4 point rate cut, Waller and Williams say:
Markets expect the Fed to lop another quarter-percentage point off its benchmark overnight borrowing rate when it meets Dec. 17-18. That would follow a half-point cut in September and a quarter-point reduction in November.
“As of today, I am leaning toward continuing the work we have started in returning monetary policy to a more neutral setting,” Waller said.
Waller said he will watch incoming employment and inflation data closely. The Bureau of Labor Statistics this week will release reports on job openings and nonfarm payrolls, the latter coming after gains in October came in at a paltry 12,000, due largely to labor strikes and weather issues.
Even with the slowing progress on inflation, Waller said broader economic health has him feeling like it will be appropriate to continue to ease monetary policy.
“After we cut by 75 basis points, I believe the evidence is strong that policy continues to be significantly restrictive and that cutting again will only mean that we aren’t pressing on the brake pedal quite as hard,” he said.
Also Monday, New York Fed President John Williams expressed confidence that inflation is heading lower and said he still thinks it will be likely to put policy in a more “neutral” setting over time, without providing specifics. |
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