Fed’s Daly: One or two more rate cuts reasonable this year

San Francisco Fed President Mary Daly signaled in a speech overnight that additional rate cuts are in the pipeline for this year, suggesting that “one or two” further reductions would be a “reasonable thing to do.”

Daly emphasized that the primary focus now is on determining “how quickly to adjust,” rather than where the ultimate destination of the easing cycle will be.

She also acknowledged that “the economy is clearly in a better place,” pointing to significant progress in reducing inflation pressures. She also highlighted that the labor market is now on a more sustainable path, which was a key concern earlier this year. With both inflation and employment showing healthier trends, Daly noted, “the risks to our goals are now balanced.”