A Federal Reserve official stated that he believes the decision to cut interest rates last month was a "critical decision," as the current economic outlook seems different from when the Fed began cutting rates four months ago. St. Louis Fed President Musalem said that by the time of last month's meeting, the risk of inflation hovering between 2.5% and 3% had increased. Therefore, he believes that further interest rate cuts should be approached with more caution. Musalem previously hinted that he supported the Fed's decision to cut rates by 50 basis points in September. "Conditions have changed since last September," he said in an interview on Thursday. "Economic data is stronger, and inflation numbers are also higher than expected. So I changed my assessment of the risks," adding that future rate cuts "must be gradual and more gradual than I imagined in September." Musalem stated that the job market is in good shape and needs to be closely monitored, but there are still "inflation issues" in the Fed's mandate. Because his estimate of the neutral interest rate is slightly higher than most of his colleagues, the currently set rate may be slightly below the appropriate limit.