US: Boston Fed Collins leaves the door open to rate cuts later in the year
|Boston Fed Susan Collins spoke at the Boston Economic Club:
She suggested that It is likely that we will cut rates later this year if the economy meets expectations.
Collins added that monetary policy is well positioned for the current outlook. Progress back to 2% inflation could be uneven and bumpy.
She suggested that when cuts start, they should be gradual and methodical. While she supported the FOMC decision to keep rates steady last week, she still needs more data before supporting a rate cut.
Collins stressed that the strong January jobs data shows why caution is warranted. The economy needs to moderate to achieve 2% inflation.
Finally, she said she needs to see wage gains moderate to aid the move to 2% inflation. Recent data shows economic resilience, but demand will take time to moderate.
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