New York Federal Reserve President John Williams indicated his support for an additional interest rate cut in 2025, citing concerns about a potential further slowdown in the labor market.
"My personal view is that we will cut interest rates this year, but we have to see exactly what that means," Williams said in an interview published Thursday by The New York Times.
Williams emphasized the need to balance inflation control with labor market stability. He noted that while allowing inflation to exceed the central bank's 2% target would be damaging to the economy and the central bank's credibility, policymakers must also work to reduce the risk of a more severe labor market slowdown.
"The risk of inflation running too high above 2% and not getting it down would be very damaging to the economy and our credibility. But we have to do it in a way that does our best to reduce the risk of a more severe labor market slowdown," Williams told the newspaper.
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