Dallas Fed President: Expects to expand the balance sheet again soon, December rate cut is difficult, asset valuations are relatively high

The President of the Federal Reserve Bank of Dallas, Lorie Logan, who previously worked in the market operations department of the New York Federal Reserve, recently stated that she expects the balance sheet to be expanded again soon. She reiterated the call to slow down on further interest rate cuts, stating that it is likely necessary for the Federal Reserve to remain on hold at the December meeting. She mentioned that high asset valuations and narrowing credit spreads not only imply that the policy may not be particularly tight but also indicate that the federal funds rate needs to offset the tailwinds brought by the current financial environment