Mary Daly: The interest rate cut in October was a strategic move.

Interest Rate Reduction Decision Taken in October

The Federal Reserve (Fed) has lowered the policy interest rate by 25 basis points, bringing it to a range of 3.75-4%. This decision is seen as one of the critical steps that will determine the trajectory of the economy. San Francisco Fed President Mary Daly emphasized that this interest rate cut in October is a correct step given the current economic conditions.

Statements Regarding the Interest Rate Decision in December

Daly stated that monetary policy still needs to remain moderately restrictive. However, she expressed an open mind regarding the December interest rate decision. This situation serves as an important indicator for investors and market analysts. Daly's statements provide clues about the Fed's future direction.

Inflation and Market Dynamics

The total 50 basis points of interest rate cuts made this year have positioned the Fed in a better place. However, Daly pointed out that inflation still remains above the target, stressing the need to continue working to reduce price pressures. In this context, factors such as fluctuating energy prices and supply chain issues were emphasized for their impact on inflation.

Differences of Opinion Within the Fed

Daly also noted that there has not been more disagreement within the Fed compared to previous periods. This could be an important factor for a potential interest rate hike or other monetary policy implementation. Overall, Daly’s assessments create content that should be closely monitored by investors and economists.