Federal Reserve Bank of St. Louis President Alberto Musalem said he supported last month’s interest-rate reduction as a way to take out insurance against the weakening labor market, but reiterated officials need to continue leaning against elevated inflation.
“Looking ahead, I am open-minded about a potential further reduction in interest rates to provide further insurance against labor market weakening,” Musalem said Friday during an event in Springfield, Missouri. “I believe that we have to tread with caution, because there’s limited room for further easing before monetary policy could become overly accommodative.”