Federal Reserve official: Further rate cuts may not be necessary, even if inflation continues to cool

Dallas Fed President Logan, a member of the 2026 FOMC voting committee, said interest rates may already be close to neutral, and the need for further rate cuts may be avoided even if inflation continues to cool.
"What if inflation gets closer to 2 percent in the next few months?" Logan said in prepared remarks at an event in Mexico City on Thursday. "While this is good news, it doesn't necessarily, in my opinion, make the FOMC cut rates any time soon," she said.
In an environment of strong demand and a stable job market, inflation is falling back towards the Fed's target, suggesting the Fed's benchmark policy rate could be close to neutral, Logan said. If that continues, she added, there won't be "much" room for rate cuts in the short term. Neutral interest rates are levels at which a central bank's policy setting neither boosts nor hinders the economy. (Jin X)