Mary Daly's Fed Interest Rate Stance Sparks Economic Debate

Mary Daly, the President of the San Francisco Federal Reserve, is standing firm against a drastic 50 basis points interest rate cut at the Federal Reserve's upcoming September meeting, according to a report by the Wall Street Journal.

Daly highlights that she perceives no urgency in the labor market that would necessitate such a significant rate cut. Since the Federal Reserve's decision to keep rates unchanged last month, sentiments within the central bank seem to be shifting, with several officials expressing discomfort over labor market conditions and showing openness to the idea of rate cuts.

This evolving stance aligns with U.S. President Donald Trump's call for lower interest rates. Meanwhile, Daly remains cautious but may support a September cut due to lessened inflation pressures and softening job-market conditions, advocating for a gradual policy adjustment towards a neutral setting over the coming year.

(With inputs from agencies.)