Fed's Daly acknowledges that waiting too long could see the Fed lag on rates

Federal Reserve (Fed) Bank of San Francisco President Mary Daly hit newswires on Thursday, following up earlier comments from fellow Fed policymaker Christopher Waller, but taking a more measured approach to discussing the potential for near-term Fed rate cuts.

Key highlights

• The economy is in a good place, growth and jobs are solid, inflation is easing.
• The Fed has the ability to restore price stability gently, given the state of the economy.
• Monetary policy is still restrictive.
• Labor market is cooling and growth is moderating, but data is not getting meaningfully weaker.
• Daly doesn't expect very persistent inflation impact from tariffs.
• Daly says it's time to think about adjusting the interest rate.
• Daly see two cuts as a likely outcome for the Fed.
• There's a large amount of uncertainty around policy outlook.
• The cut rates, Fed needs a continuation of current data trends.
• Labor market supply and demand is roughly in balance.
• Economic fundamentals support a move toward lower rates at some point.
• Real labor market weakening could drive rate cut, but inflation issues could lean the other way.
• Fed should always have an open mind about changing rates.