Fed officials urge patience on timing of initial rate cut
WASHINGTON/AMELIA ISLAND, Florida -Federal Reserve policymakers on Tuesday said it is prudent for the U.S. central bank to wait several more months to ensure that inflation really is back on a path to the 2% target before commencing interest rate cuts.
"We just don't want to go off a cliff. That's the critical thing," Waller said."We are not seeing anything right now that looks like staying here for three or four months is going to cause the economy to go off a cliff." The remarks also appeared to add to market confidence in Fed rate cuts, with traders firming up expectations for a first reduction in borrowing costs in September and a second one at the Fed's final policy meeting of the year in December.
At a separate event at the Dallas Fed, Fed Vice Chair of Supervision Michael Barr added his voice to the chorus, repeating that higher inflation readings in the first quarter had not added to his confidence that prices pressures are easing.
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