St. Louis Fed President: The path of rate cuts should be more gradual
<ChainCatcher message> A Federal Reserve official said he believes the decision to cut interest rates last month was a close call, as the current economic outlook appears different from when the Fed began cutting rates four months ago. St. Louis Fed President James Bullard said the risk of inflation hovering between 2.5% and 3% had increased by the time of last month's meeting. Therefore, he believes more caution is needed when further cutting interest rates. Bullard had previously hinted that he supported the Fed's decision to cut rates by 50 basis points in September. "Since last September, the situation has changed, the economic data has been stronger, and the inflation figures have been higher than expected. So I have changed my assessment of the risks, and future rate cuts must be gradual, and even more gradual than I imagined in September." Bullard said the labor market situation is good and needs to be closely monitored, but there are still "inflation issues" in the Fed's mandate. Since his estimate of the neutral rate is slightly higher than most of his colleagues, the current set interest rate may be slightly lower than the appropriate limit.