On November 15, Financial Associated Press (Editor: Xia Junxiong) reported that on Thursday (November 14) local time, Boston Fed President Collins indicated that the Fed may ultimately need to slow down the pace of rate cuts, and it is still too early to determine whether a rate cut should occur in December.

The Fed has cut rates in its last two meetings, first by 50 basis points in September when there were signs that the us labor market might be weakening, and then by 25 basis points at last week's rate meeting, lowering the federal funds rate target range to 4.5%-4.75%.

The next Fed meeting is scheduled for December 17-18, and before this meeting, policymakers will examine the inflation and employment data for November.

Collins stated in a media interview on Thursday that continuing to cut rates in December "is definitely within the realm of consideration, but it's not a done deal." "From now until December, we will see more data, and we need to continue weighing what is a reasonable approach," she said.

Data released on Wednesday showed that the CPI in the USA rose 2.6% year-on-year in October and 0.2% month-on-month; the core CPI in October (excluding volatile factors such as energy and food) rose 3.3% year-on-year and 0.3% month-on-month.

The Fed Chairman stated on Thursday that the October CPI data slightly exceeded expectations. Powell said that due to the strong us economy, the Fed does not need to be "in a hurry" to lower interest rates, and the policy will gradually adjust to a neutral level, but the policy path is not pre-set.

The market interpreted Powell's remarks as a hawkish signal, and traders slightly reduced their bets on a rate cut in December.

Collins and Powell both believe that the recent stubbornness of inflation is more a lagging effect of the significant rise in inflation over the past few years or a "catch-up" phenomenon, rather than the emergence of new power technology in the economy that would lead to a rebound in inflation. For example, the rise in auto insurance costs reflects the trend of prior increases in auto prices, a trend that has already eased.

In the Federal Open Market Committee (FOMC), Collins' stance is centrist, similar to Powell, and she will obtain the voting rights on monetary policy next year.

Collins stated that the current monetary policy remains restrictive, and continuing to lower interest rates to a neutral level is appropriate. The neutral interest rate refers to the level of interest rates that neither stimulates nor suppresses the economy.

"In the absence of evidence indicating that new price pressures are emerging, I see no reason to maintain a restrictive policy, and old price pressures may dissipate in an uneven and gradual manner," Collins said.

Editor/Lambor