Fed's Daly: The timing for rate cuts is approaching, and it is more likely that there will be more than two rate cuts this year.

On August 5, Daly, president of the San Francisco Fed, stated that given the increasing evidence that the labor market is weakening and there are no signs of sustained tariff inflation, the timing for rate cuts is approaching. Daly mentioned regarding the Fed's decision last week, "I am willing to wait another cycle, but I cannot wait forever." Although this does not mean a rate cut in September is a done deal, she said, "I would tend to think that every meeting going forward is an immediate meeting to consider policy adjustments." Daly noted that a realignment of two 25 basis point rate cuts this year still seems appropriate, and the important question is whether to cut rates in both September and December, rather than whether rate cuts will occur. Daly said, "If inflation rebounds and spills over, or if the labor market warms up, then there could certainly be fewer than two rate cuts, but it is more likely that we will have to implement more than two rate cuts. If the labor market appears to be entering a weak phase and we do not see the spillover effects of inflation, we should be prepared for more rate cuts." (Jin10)