Federal Reserve's Daly: The timing for interest rate cuts is approaching, and the number of cuts this year is more likely to be greater than two

ChainCatcher news, according to Mary Daly, president of the Federal Reserve Bank of San Francisco, the timing for interest rate cuts is approaching, given the increasing evidence that the labor market is weakening and no signs of persistent tariff inflation. Daly stated regarding the Federal Reserve's decision last week, "I would be willing to wait another cycle, but I cannot wait forever."

While this does not mean that a rate cut in September is a certainty, she said, "I would tend to think that every meeting going forward is a live meeting for considering policy adjustments." Daly noted that two rate cuts of 25 basis points each this year still seem to be an appropriate recalibration, emphasizing that the key question is whether cuts will occur in both September and December, rather than if cuts will happen at all.

Daly stated, "If inflation rises and spreads, or if the labor market warms up, then there could certainly be fewer than two cuts, but it is more likely that we will have to make more than two cuts. If the labor market appears to be entering a weakening phase and we do not see the spillover effects of inflation, we should be prepared for more cuts."