More and more Fed officials are releasing signals that interest rate cuts are possible in a few months. The latest similar comment comes from Bullard, who was mentioned earlier this year as one of the leading candidates for the next chairman of the Fed and has a permanent vote on the Fed's FOMC meeting.- A leading candidate for the next chairman of the Federal Reserve, who has permanent voting rights on the Federal Reserve's FOMC meetings, is Bullard.Bullard is an important voice in the internal inflation debate in the Fed, and his views are particularly noteworthy. Bullard is naturally considered a "hawkish" figure, and he said at the end of May that he would support interest rate cuts only after seeing "several months of good inflation data". The last favored inflation gauge from the Fed he revealed after speaking on monetary policy was the PCE price index.

On Wednesday, July 17th, EST, Williams said in his prepared Kansas City speech that the US economy is getting closer to the point where the Federal Reserve can lower interest rates, while suggesting that it is not yet time to do so. He hopes to see "more evidence" that inflation is on a sustainable downward trajectory. Williams said,

"At this point, the data are consistent with a soft landing, and I'm going to be looking for the confirmation in the next few months in the data that it's still appropriate to lower rates. I believe we haven't quite reached our destination, but I do believe that we're getting close to the point where we might want to think about adjusting policy to stimulate the economy."

Two months ago, Williams said he wanted to see 'months' of positive data that would support a rate cut and suggested that it might not be necessary before December. On Wednesday, he said the recent labor market and inflation data showed progress in declining inflation. The media commented that his comments paved the way for a rate cut before September.

The media pointed out that Williams has been focusing on the necessity of reducing inflation for two years. On Wednesday, he emphasized the importance of preventing labor market slowing down, which was an important turn for him. Williams said,

"Currently, the labor market is in its best state. We need to keep it in this best state."

The PCE price index same-store growth rate has slowed from 2.7% to 2.6%, and core PCE inflation has also slowed to 2.6%, the lowest rate in three years. Powell pointed out that while focusing on the cooling of inflation, the Fed has also begun to pay more attention to the potential risks of labor market weakness. Some analysts believe that recent comments from several Fed officials have strengthened this key turning point in the Fed's stance.mmfIndicators show that the same-store growth rate of PCE price index has slowed from 2.7% to 2.6%, and core PCE inflation has also slowed to 2.6%, the lowest rate in three years.

The current market widely expects the Federal Reserve to cut interest rates for the first time in this cycle in September. However, like other Federal Reserve officials, Williams did not provide guidance on when the Federal Reserve will cut interest rates on Wednesday. He analyzed three different scenarios for the US economy in the coming months and policy choices that may be taken against these scenarios. All scenarios assume that labor market will not be significantly weak. These scenarios are:

• If inflation data for the next two months are as mild as in May and June, the Federal Reserve will cut interest rates in September.

• If the inflation data is mixed, the rate cut path will be more uncertain.

• If inflation rebounds sharply, the red light of inflation reduction will come on. The Federal Reserve will postpone the rate cut, as it did in the spring of this year.

Williams believes that the most likely scenario is that inflation is 'uneven'--not as good as recent reports but still consistent with the overall progress in reducing inflation to the 2% target. He said that the uncertainty about the recent rate cut is greater in this case. Another possible scenario is that inflation continues to be 'very favorable.' In this case, Williams said, "I can foresee a cut in the near future."

Williams' speech earlier in the day, on Wednesday, was echoed by New York Fed chairman William Dudley, the Fed's 'big three', who said he would cut interest rates in the coming months if inflation continues to slow. There are indications that the US labor market is cooling down and that the past three months' inflation data is 'closer to the deflationary trend we want.'

Nick Timiraos, the well-known financial journalist referred to as the 'Fed Communications Agency,' believes that Williams hinted that the Fed is close to cutting interest rates but is not yet ready to do so. That is, it will not cut interest rates in July and may consider doing so in September.

On Monday of this week, Federal Reserve Chairman Powell also hinted that a rate cut was coming. He said that more progress had been made in US inflation this year, including last week's data, and that the recent three inflation reports were 'pretty good' and 'indeed somewhat stronger' in boosting the Federal Reserve's confidence that inflation will continue to fall to its target.

Powell pointed out that while focusing on the cooling of inflation, the Fed has also begun to pay more attention to the potential risks of labor market weakness. Some analysts believe that recent comments from several Fed officials have strengthened this key turning point in the Fed's stance.

Editor/Somer