WASHINGTON (dpa-AFX) - The Federal Reserve can make more reductions as projected earlier but policymakers should wait for more clarity regarding trade and other policies, Federal Reserve Bank of San Francisco President Mary Daly said on Friday.
U.S. inflation is moving closer to the 2 percent goal, but 'we aren't there yet', Daly said in a post on the professional networking platform LinkedIn. The risks to inflation are elevated compared to a year ago, she pointed out.
The Fed is in a good place with policy and there is time to make a good decision, Daly said. Monetary policy is still restrictive and there is room to make gradual reductions in the fed funds rate as projected earlier, she added.
'But we don't have to be urgent. The labor market is stable and the economy is solid,' Daly said. 'We can wait for more clarity around trade and other emerging policies.'
The FOMC, led by Jerome Powell, left interest rates unchanged for a second policy session in a row in March, but projections signaled the central bank is still likely to lower rates later this year.
The Fed's next monetary policy meeting is scheduled for May 6-7 and the central bank is widely expected to maintain status quo again.
'The Federal Reserve made a promise to the American people: We will restore price stability,' Daly said. 'That is the critical foundation for our work.'
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