“That doesn’t mean we’re going to kick off a rate-cutting cycle,” because fiscal deficits are high and energy prices remain high,” he told Bloomberg TV in Tokyo. “It’ll be one meeting at a time.”
Kaplan was speaking after a number of Fed officials led by Chair Jerome Powell noted in recent weeks that the central bank is making some progress toward lowering inflation to its 2% goal, though they have been vague about the timing of interest rate cuts.
Inflation slowed in the second quarter, with the so-called core consumer price index rising just 0.1% in June, marking the smallest monthly advance since 2021.
As for Japan, Kaplan noted that the economy faces headwinds due to demographic trends that are eroding the workforce.
