Fed's Daly considers US monetary policy adequate

San Francisco Fed President Mary Daly described monetary policy as adequate for achieving a targeted reduction in inflation.

While the official does not necessarily expect inflation to reach the central bank's 2% target this year, she stressed the progress made. Inflation is expected to continue declining due to a cooling labor market, which remains resilient. Employees may need more time to find work, but that outcome aligns with ensuring a stable labor market consistent with 2% inflation, Daly said.

Daly noted that Trump’s pressure on the Federal Reserve (Fed) to reduce borrowing costs is not the first time the administration has pushed the Fed to align with presidential preferences. She called it part of the job. The official also added that the Fed will do everything in its power to meet Congress’s targets for price stability and full employment, guided by politically unbiased analysis.