Dallas Fed President Lorie Logan Urges Caution on Future Rate Cuts Amid Inflation Risks

Federal Reserve Bank of Dallas President Lorie Logan has become the latest Fed official to weigh in on U.S. monetary policy, warning that inflation risks remain more pressing than labor market concerns. Her comments come as the crypto market anticipates a possible Federal Reserve rate cut at the upcoming October 28–29 FOMC meeting, fueling a rally in Bitcoin.

Logan emphasized that while the U.S. economy is seeing signs of labor market weakness, inflation remains above the Fed’s 2% target. She noted that recently imposed Trump tariffs could push prices higher in the coming months, making premature rate cuts risky. Logan stated that monetary policy is only “modestly restrictive” and should remain so to ensure downward pressure on inflation, suggesting she may not support a cut at this month’s meeting.

Her stance mirrors earlier comments from Fed Chair Jerome Powell, who acknowledged tariff-driven inflationary pressures but argued they could be temporary. Similarly, Cleveland Fed President Beth Hammack has signaled support for a more restrictive policy to contain price growth. Logan stressed that normalization of the policy path should remain slow to secure long-term stability, warning that reaching the 2% inflation goal will take time.

Despite these concerns, the labor market has shown signs of strain. The September ADP jobs report fell well below expectations, raising recession fears. Markets are currently pricing in a 97% chance of a 25-basis-point cut at the October meeting. However, views across the Fed remain divided. Chicago Fed President Austan Goolsbee recently stated that the labor market remains balanced and the economy continues to expand solidly. In contrast, Fed Governors Michelle Bowman and Stephen Miran are pushing for more aggressive cuts, with Miran even calling for multiple 50 bps reductions to stabilize growth.

The Fed now faces a delicate balancing act between containing inflation and supporting a cooling labor market, with financial markets and crypto investors closely watching the central bank’s next move.