In a rate cut earlier this month, the Federal Reserve lowered the Intrerest Rate by 50 basis points, far exceeding market expectations. In response, Musallam called for the Fed to resume a 'gradual' pace of rate cuts to avoid the risks of excessive easing. He believes that the US economy may react 'very positively' to the current more accommodative financial environment, further intensifying the pressure for rise in demand, thereby prolonging the time for the Fed to achieve its 2% inflation target.



Mousalem pointed out: "At this stage, the key is to appropriately relax the tightening of policies and gradually reduce restrictive measures on the economy." He believes that in this gradual way, the Fed can better balance the relationship between supporting economic growth and suppressing inflation. According to the economic forecast released at this month's Fed meeting, Mousalem is one of the officials who expects to continue to cut interest rates by 25 basis points or more for the rest of this year.

This policy proposal reflects the optimistic attitude of some officials towards the economic outlook, believing that moderate easing policies can provide more impetus to the economy while avoiding excessive risks to the inflation target.
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