Top official says Federal Reserve can’t risk being too late with rate cuts

AP Economics Writer

WASHINGTON (AP) — A top Federal Reserve official warned that the central bank needs to cut its key interest rate before the job market weakened further or the Fed would risk moving too late and potentially imperil the economy. In an interview with The Associated Press, Austan Goolsbee, president of the Federal Reserve Bank of Chicago, said that because the Fed’s rate decisions typically affect the economy only after an extended time lag, it must avoid waiting too long before reducing rates. With inflation steadily easing, the Fed is widely expected to start cutting its benchmark rate next month from a 23-year high. Most economists envision a modest quarter-point cut next month, with similar rate cuts to follow in November and December.