"Moderate Tendency" Boston Fed Governor "Rate Cuts, Indicators Need To See More"

On monetary policy, centrist Federal Reserve Bank of Boston President Susan Collins said more economic indicators should be looked at to determine whether to cut the benchmark interest rate in December.

Collins told the Wall Street Journal that the time was right for the Federal Reserve to slow down its key rate cut more slowly and carefully.

The remarks are in line with Fed Chairman Jerome Powell's earlier statement the day before, saying, "The U.S. economy is not sending any signals that it needs to hurry to cut interest rates."

However, Collins acknowledged the need to continue lowering the benchmark interest rate to the so-called "neutral interest rate" level, which can maximize employment without fueling inflation.

Collins said he believes the current U.S. benchmark interest rate, which is between 4.5 and 4.75%, is at a tight level beyond the neutral rate level, adding that it is appropriate to continue cutting the benchmark rate.

For that reason, he predicted that inflation would continue to slow down, evaluating that "the factors that caused inflation are steadily resolved and that there is no reason to keep monetary policy tight in the situation."

Earlier, when car prices rise, the impact of high price shocks continues with a lag, leading to higher car insurance premiums later, but it is not a new inflationary pressure.

Regarding the Fed's December rate cut, which Wall Street sees as likely, he said "it has been put on the option, but nothing has been confirmed," adding that "there are additional indicators until December, and we will have to continue reviewing what makes sense."

Collins has been a centrist voice among members of the Federal Open Market Committee and has not held the right to vote on monetary policy decisions this year, but will do so next year.