The 'risk management cut' that Jay Powell talked about was the right thing to do: Roger Ferguson

Federal Reserve Policy & Interest Rates - The Federal Reserve cut interest rates by 0.25 percentage points, a decision characterized as "risk management" [1] - The vote for the rate cut was 11 to 1, with one Fed Governor voting for a 0.5 percentage point reduction [1] - The Fed is signaling the possibility of two more rate cuts before the end of the year [2] - The concept of a "risk management cut" suggests the balance of risk has shifted towards weakness in the labor market [7] Economic Outlook & Risks - The economy faces two-sided risk, with a weak labor market and high inflation, creating a difficult situation for policymakers [2][6] - Inflation remains high, potentially increasing gradually, while the labor market shows some weaknesses [5] - Recent retail sales data surprised on the upside, indicating some remaining strength in the economy [13] - The economy is more complicated than headlines suggest, with consumption largely driven by wealthier Americans [16][17] Housing Market - The US is estimated to be 2 to 3 million houses short of the required amount, making it a complex supply and demand story [16] - A 0.25 percentage point rate reduction is not expected to dramatically change the housing outlook [16]