Fed's Logan (2026 voter) says in coming months if inflation falls and labour market stays stable, no further rate cuts will be needed

• Should provide central clearing for Fed's standing repo operations.

• More worried about inflation remaining stubbornly high.
• Not fully confident inflation is heading all the way back to 2%.
• Anticipate progress on inflation this year; have already seen some tentative signs.

• If see further material cooling in the labour market, cutting rates could be appropriate.
• Labour market stabilising, and downside risks have meaningfully dissipated.

• Current policy stance may be very close to neutral, providing little restraint.
• Cautiously optimistic current policy stance will get inflation down to 2%, sustain balanced labour market.
• Last year's rate cuts were Insurance against labour market cooling, and additional risk on inflation.
• Real Fed Funds Rate now sits squarely within range of neutral rate estimates.

• Economic activity has rebounded strongly.
• Inflation has been above 2% target for nearly 5 years.

Fed's Logan, a 2026 voter, suggests no further rate cuts are needed unless there's a significant easing in the labor market. His comments reflect a cautious optimism about current policy, indicating it may be close to neutral, while highlighting concerns that inflation remains persistently high, with uncertainty about returning to the 2% target. This stance could imply a steady outlook for interest rates in the near term, affecting both fixed income and the USD.