Fed’s Daly Supports Rate Cuts, Downplays Division; Trump Admin Partially Funds Food Stamps

By / / Breaking News

Key Takeaways

  • Federal Reserve's Mary Daly indicated that 50 basis points (bps) of rate cuts this year would position the Fed better, confirming her support for a recent rate reduction.
  • Daly emphasized that the Federal Open Market Committee (FOMC) is not "divided," despite encouraging debate, and stressed the need to keep policy "modestly restrictive" while maintaining an "open mind on December."
  • The Trump Administration announced it would partially fund November food stamp benefits, providing 50% of aid after court rulings mandated continued payments amidst a government shutdown.

Fed's Daly on Monetary Policy and Economic Outlook

San Francisco Federal Reserve President Mary Daly stated that 50 basis points of rate cuts this year would leave the Federal Reserve better-positioned, emphasizing the need for decisions that balance risks. She confirmed her support for a recent rate cut, deeming it appropriate for the current economic climate.

Daly acknowledged that inflation remains above target and needs to be brought down, while noting that the labor market has softened "quite a bit". Despite these dynamics, she maintained that policy needs to remain "modestly restrictive". Looking ahead, Daly expressed an "open mind on December" regarding future policy adjustments.

Addressing perceptions of internal disagreement, Daly asserted that the Fed is "not a more divided Fed than before," and would not even use the word "divided". She encouraged debate and disagreement within the FOMC, viewing it as a healthy and necessary part of the decision-making process.

Trump Administration to Partially Fund Food Stamps

In a separate development, the Trump Administration announced it would partially fund food stamp benefits for November following a court loss in a shutdown fight. The Department of Justice (DOJ) confirmed that funds are available to cover 50% of November's food aid benefits.

The decision to partially fund the Supplemental Nutrition Assistance Program (SNAP) comes after federal judges ruled that the administration was required to use available contingency funds to continue the program amidst a government shutdown. Officials indicated that roughly $5.2 billion in contingency funds would be used, covering a portion of the estimated $9 billion needed for full November payments.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. We are not financial professionals. The authors and/or site operators may hold positions in the companies or assets mentioned. Always do your own research before making financial decisions.
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