BlockBeats news, September 28, according to the Financial Times, St. Louis Fed President Musallem said that after cutting interest rates by 50 basis points earlier this month, which was larger than usual, the Fed should resume the practice of "gradual" interest rate cuts. Musallem said that the US economy may respond "very positively" to a looser financial environment, thereby stimulating demand and extending the time it takes for the Fed to reduce inflation to 2%.

"For me, it's about easing the brakes at this stage. It's about gradually reducing policy restrictions," Musallem said. According to the forecast released at this month's meeting, he is one of the officials who expects to cut interest rates by more than 25 basis points for the rest of the year.

Musallem acknowledged that the labor market has cooled in recent months, but he remains optimistic about the outlook given the low unemployment rate and underlying economic strength. Musallem supported a rate cut in September. He said the business sector was in "good shape" and overall activity was "solid," adding that large-scale layoffs did not appear "imminent." However, he acknowledged that the risks facing the Fed might require it to cut rates more quickly.

"I realize that the economy may be weaker than I currently anticipate and the labor market may be weaker than I currently anticipate," he said. "If that is the case, then it may be appropriate to accelerate the pace of rate cuts." (Jinshi)