SINGAPORE (Reuters) – Former New York Federal Reserve President Bill Dudley said there was a strong case for a 50 basis point interest rate cut in the United States.
“I think there’s a strong case for 50, whether they’re going to do it or not,” he said at the Bretton Woods Committee’s annual Future of Finance Forum in Singapore.
He said rates were currently 150-200 basis points above the so-called neutral rate for the U.S. economy, where policy is neither restrictive nor accomodative. “So the question is: ‘Why don’t you just get started?'”
Dudley had previously called for the Fed to begin cutting in July. U.S. yields fell in Asia trade on Friday while rates futures rallied in reaction to media reports that next week’s decision on whether to cut by 25 bps or 50 bps was a close call.
(Reporting by Rae Wee; Editing by Himani Sarkar and Muralikumar Anantharaman)
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