The Federal Reserve Board of Governors member Cook: There is a possibility of a rate cut in December, but it will depend on the subsequent new information.

On November 4, Federal Reserve Board of Governors member Cook stated on Monday that she believes there is a possibility of an interest rate cut at the Fed's December meeting, but the decision at that time will be based on information from a wide range of channels from now until then, especially in light of the federal government shutdown that has caused delays in the release of official data. Cook said, “Currently, the risks on both sides of the dual mandate are rising. Keeping interest rates too high increases the likelihood of a sharp deterioration in the labor market; while a rate cut that is too large could unanchor inflation expectations.” “Delivering an economic outlook speech at this moment is quite challenging,” she said, noting that since the government shutdown began on October 1, the latest official data regarding employment, inflation, and economic growth has been missing. However, she emphasized, “We are not acting blindly.” Policymakers and staff are actively sorting through various available administrative data, private sector data, as well as results from several surveys conducted by the Fed on businesses and households. This data has so far confirmed her judgment: inflation is likely to remain slightly above target and faces upward risks, while the labor market overall remains robust but is cooling and may experience a faster-than-expected decline. ( Jin10 )