Federal Reserve Governor Stephen Miran said better-than-expected inflation data and signs of continued weakness in the labor market call for a third consecutive interest rate cut in December.
In the absence of new economic information due to the government shutdown, a half-point cut next month is still "appropriate," Miran said Monday in an interview with CNBC. "At a minimum," he added, the central bank should lower rates by an additional quarter of a percentage point.
"We have new inflation data that is better than expected, which would lead one to think that it would be reasonable to be more gradually dovish" than in September, when officials' rate projections indicated three quarter-point cuts this year, Miran said.
"Furthermore, the labor market data has come out showing the labor market continuing on its trajectory of gradual weakness," he said. Fed officials lowered their benchmark interest rate by a quarter point last month but did not signal a cut in December. Several policymakers have recently raised concerns about price pressures. Consumer price inflation surged to 3% year-to-date through September. (alg)
Source: Bloomberg.com
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