Fed's Powell: Further Rate Cuts Appropriate if Inflation Slows

Odaily News Fed Chair Powell reiterated on Wednesday that she expects the Fed may cut short-term interest rates later this year if the economy performs in line with her expectations of slowing inflation and a stable labor market. In prepared remarks for a Greater Philadelphia Chamber of Commerce event, Powell stated: "My baseline outlook is fairly mild," expecting inflation to fall back to around 2% by year-end, the labor market to stabilize, and economic growth to remain around 2%. She noted: "If all of that happens, then some modest adjustments to the federal funds rate later this year may be appropriate." Regarding the labor market, Powell again emphasized, "The labor market is clearly slowing but not collapsing." She sees rising risks, which was also one of the important reasons she supported the FOMC's 75 basis point rate cut last year. (Jin10)