Bloomberg Talks San Francisco Fed President Mary Daly Talks Fed Policy, Labor Market
Jul 17, 2025
Mary Daly, President of the Federal Reserve Bank of San Francisco, joins Bloomberg’s Michael McKee to unpack the current economic landscape. She shares her thoughts on upcoming rate cuts and the challenges of a labor market shaped by immigration policies and technological innovation. Daly emphasizes how generative AI can enhance productivity without displacing jobs, urging the workforce to adapt. They also dive into the complexities of interest rates, inflation, and the importance of strategic decision-making in maintaining economic stability.
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Fed's Dual Mandate Importance
- The Fed's main role is to foster prosperity by supporting the labor market and maintaining price stability.
- When the Fed does its work well, all other economic activities can flourish without interference.
Inflation as an Unpredictable Tax
- Inflation is a major unpredictable tax that severely impacts people's financial well-being.
- Achieving price stability means people stop worrying about inflation, marking a significant victory for the economy.
Balancing Growth and Inflation
- The economy is responding to restrictive interest rates with slowed growth and a more sustainable labor market.
- Balancing a healthy labor market and price stability is crucial to ensure long-term economic prosperity.