Fed’s Daly Warns ‘Softening’ US Job Market May Soon Become ‘More Worrisome’

San Francisco Federal Reserve Bank President Mary Daly warned on Thursday that the “softening” U.S. job market could become “more worrisome” if the central bank is unable to “risk manage it.”

Daly’s comments come after the Fed announced on Sept. 17 that it was making its first interest rate cut of the year, following mounting pressure from President Donald Trump. Daly also said during a Thursday event at the Silicon Valley Directors Exchange that the Fed’s decision to cut rates in September was partly due to easing inflation and a slower labor market, Reuters reported.

“That interest rate cut we took — and we projected we might take more — those were cuts designed to risk manage as we move both our inflation goal and our employment goal to a more perfect balance,” Daly said, according to Reuters.

“The economy is slowing a little bit,” Daly added. “Consumers are running out of all the excess savings they might have had and they’ve been dealing with a higher price level. And then we have restrictive monetary policy.”

Federal Reserve Chair Jerome Powell notably said Sept. 23 that the Fed is currently grappling with a “challenging situation” due to inflation risks and recent lackluster employment data.