The Federal Reserve's Mucullaeum is skeptical about further interest rate cuts.

Federal Reserve official Mousalem expressed doubt about further interest rate cuts, contrary to the widespread expectation in the financial markets that the Fed will continue to lower borrowing costs this year. Mousalem stated that he supported a 25-basis-point rate cut last week because he believed that there were increased risks in the labor market. However, with the inflation rate nearly a percentage point above the Fed's 2% target, further rate cuts could mean excessive complacency towards rising prices. "If the public begins to doubt whether inflation can return to the 2% target, then the task of restoring price stability will become more difficult and could have higher costs for the economy." Traders' bets indicate that the Fed will cut rates by another 50 basis points in the remaining two meetings this year. Furthermore, his views are also at odds with the Fed's new director Milan. Milan opposed a slight rate cut at the last meeting and advocated for a larger cut instead.