The "Three Chiefs" of the Federal Reserve did not disclose the extent of the first rate cut but vowed to shift policy towards neutrality

According to the financial news app Zhitong Finance, John Williams, the President of the Federal Reserve Bank of New York, known as the "third in command of the Fed" and enjoying permanent voting rights in the FOMC, stated on Friday that given the progress made in reducing inflation and cooling the job market, it is appropriate for the Federal Reserve to cut interest rates now.

Williams stated that the Federal Reserve has made "significant progress" in maintaining price stability and full employment, and the risks of achieving these two goals have reached a "balance" state.

Williams said: "As the economy is currently in balance, inflation is heading towards 2%, it is appropriate to reduce the degree of policy constraints by lowering the target range for the federal funds rate."

Before he made the above remarks, the latest data showed that the U.S. added 142,000 new jobs in August, while the data for the previous month was revised downward to 89,000. The unemployment rate slightly decreased to 4.2%.

It is widely expected in the market that the Federal Reserve will cut interest rates at the meeting on September 17th to 18th. Federal Reserve Chairman Jerome Powell explicitly stated last month that the Fed is not seeking nor hoping for further cooling of the labor market.

Officials have emphasized in recent weeks that they are closely monitoring the employment situation, as inflation has been their main focus in the past few years. Meanwhile, price pressures continue to weaken.

Williams expressed confidence that inflation is steadily moving towards the Fed's 2% target, and added that the labor market is unlikely to be a source of future price pressures.

Williams said: "The risks of our two goals are now in a better balance, and policy needs to be adjusted to reflect this balance." He believes that the downward trend in inflation is broad-based and evident in the data.

Williams expects the inflation indicator favored by the Federal Reserve to slow to around 2.25% this year and approach 2% next year.

With the interest rate cut almost certain to begin this month, a key issue facing the Federal Reserve is the extent of the rate cut and the speed and magnitude of subsequent cuts.

Although Williams did not disclose the magnitude of the first rate cut by the Federal Reserve, he stated that officials can "over time, adjust policy towards neutrality - a policy stance that neither promotes nor restricts economic activity - based on changes in data, outlook, and risks to achieving our goals."

Powell also stated last month, "The timing and pace of rate cuts will depend on the upcoming data, evolving outlook, and risk balance."