Federal Reserve's Paulson: If inflation cools, the Fed may further cut interest rates

The President of the Philadelphia Federal Reserve, Harker, stated that if inflation cools, the Federal Reserve may further lower interest rates, but also hinted that any additional rate cuts may not be implemented immediately. In a speech delivered in Philadelphia on Saturday, she expressed a cautiously optimistic view that the upward pressure on prices may ease in the coming months. This is her first year serving as a voting member of the Federal Open Market Committee. She noted that the current target range of 3.5% to 3.75% still feels "somewhat tight," indicating that this level of interest rates is sufficient to curb inflation, which could create conditions for further rate cuts in the future.

According to the published speech transcript, Harker said, "If inflation eases and the economy remains on track, a modest adjustment to the federal funds rate later this year may be appropriate." Harker indicated that the "signals regarding the health of the labor market are mixed," suggesting that while the market is under pressure, it has not collapsed, and she is waiting for more data to clarify the situation. This statement implies that she may want to see more evidence regarding the evolution of the economy in the coming months before supporting further policy adjustments. (Jin Shi)