Fed's Williams tells New York Times he backs more rate cuts this year

Core Viewpoint - New York Federal Reserve President John Williams supports additional interest rate cuts this year due to risks of a slowdown in the labor market, although he does not foresee an imminent recession [1][2]. Group 1: Interest Rate Outlook - Williams anticipates lower interest rates this year, contingent on economic data aligning with his outlook [2]. - He suggested the possibility of two more 25-basis-point cuts to the Fed's policy rate, currently in the 4.00%-4.25% range, if inflation trends towards 3% and unemployment rises slightly [3]. Group 2: Balancing Inflation and Employment - The Fed aims to balance lowering inflation, which is above the 2% target, while supporting a weakening job market [3]. - Williams emphasized the importance of maintaining credibility by preventing inflation from exceeding the 2% level without appropriate measures [3]. Group 3: Recent Fed Actions - The U.S. central bank reduced its policy rate by 25 basis points during the September 16-17 meeting, aiming to keep policy tight enough to restrain the economy while providing some support for the job market [3]. - Minutes from the September meeting indicated that Fed officials recognized increased risks to the job market, justifying a rate cut, but remained cautious about high inflation [4].