Fed’s Collins: Further rate cuts likely, remain carefully data dependent

Boston Fed President Susan Collins highlighted yesterday that further rate cuts will “likely be needed” to support the economy. However, she emphasized that Fed’s policy decisions are not on a “pre-set path” and will remain “remain carefully data dependent”.

Collins noted that while core inflation pressures are still elevated, she is gaining confidence that inflation is gradually returning to the 2% target. She also addressed the labor market, noting that the September jobs report, which exceeded expectations, confirms her view that the job market is “in a good place” — neither too hot nor too cold. She stressed that preserving the healthy labor market conditions is crucial and will require economic activity to grow near trend, which remains her baseline outlook for the coming months.