Dallas Fed President Lorie Logan said it’s a “good idea to slow down” in “today’s complex economic and financial environment”.
“That’s why I supported the decision last month to reduce the pace of rate increases. And the same considerations suggest slowing the pace further at the upcoming meeting,” she added.
“A slower pace is just a way to ensure we make the best possible decisions,” she said. “We can and, if necessary, should adjust our overall policy strategy to keep financial conditions restrictive even as the pace slows.”
She added that Fed should not “lock in” on a terminal rate. “My own view is that we will likely need to continue gradually raising the fed funds rate until we see convincing evidence that inflation is on track to return to our 2 percent target in a sustainable and timely way,” she said.
“The most important risk I see is that if we tighten too little, the economy will remain overheated, and we will fail to keep inflation in check,” Logan said.
