Fed’s Mary Daly says it’s ‘too early to declare victory’ on inflation

Tighter
monetary
policy
is
helping
bring
down
the
pace
of
inflation
but
not
to
a
level
where
policymakers
should
feel
too
comfortable,
San
Francisco
Federal
Reserve
President
Mary
Daly
said
Friday.

“The
news
on
inflation
has
been
fairly
good,
and
we
shouldn’t
dismiss
that,”
the
central
bank
official
said
during
an
interview
on
CNBC’s
“The
Exchange.”
“All
of
that
said,
it
is
far
too
early
to
declare
victory.”

Those
comments
come
a
day
after
Fed
Chair

Jerome
Powell
helped
spook
financial
markets
when
he
said
he
and
his
fellow
officials

are
“not
confident”
that
policy
has
reached
a
point
of
being
tight
enough
to
get
inflation
down
to
their
2%
target.

Daly
compared
the
Fed’s
job
to
get
policy
to
the
“sufficiently
restrictive”
benchmark
to
someone
riding
a
horse
and
trying
to
know
whether
the
bridle
has
been
pulled
back
far
enough
to
stop.

“You
don’t
know
if
the
horse
is
feeling
that
bridle
enough
to
be
sufficiently
restrictive
to
stop,”
she
said.
“So
much
like
the
horse,
we’re
in
a
position
now
where
we
know
we’re
significantly
restrictive.
But
to
really
be
truly
confident
that
we
have
a
sufficient
level
of
restriction
in
the
economy
to
bring
inflation
down,
we’re
going
to
have
to
watch
the
data
and
see
if
the
economy
is
slowing.”

For
the
second
meeting
in
a
row,
the
Federal
Open
Market
Committee
last
week

decided
to
hold
rates
in
place,
with
the
Fed’s
benchmark
borrowing
level
targeted
in
a
range
between
5.25%
and
5.5%,
its
highest
in
22
years.

Daly,
who
will
be
an
FOMC
voter
in
2024,
did
not
commit
to
a
position
on
the
future
of
rates,
instead
saying
the
Fed
is
in
a
place
where
it
can
evaluate
the
incoming
data
and
move
accordingly.

“We’re
going
to
be
very
forward-looking
here,
and
so
that’s
why
it’s
too
early
to
declare
victory.
But
I
don’t
want
to
discount
the
fact
that
we’re
in
a
good
place
because
we
can
be
able
to
move
easily
and
agilely,
depending
on
what
the
data
brings,”
she
said.

Don’t
miss
these
stories
from
CNBC
PRO: