Federal Reserve Board member Michelle Bowman on Wednesday called for a “cautious approach” to any further rate cuts, noting that inflation remains a concern and the labor market is strong.

The US central bank unanimously decided earlier this month to cut interest rates by 25 basis points, to a range of 4.50% to 4.75%, the day after Donald Trump was re-elected to the White House.

Bowman said she supports the move because it aligns with her preference for a gradual reduction in short-term borrowing costs. Bowman was the only one to disagree with the Fed cutting interest rates by half a percentage point in September.

The Fed board official added that he believes the neutral rate — the level of borrowing costs that neither boosts nor hinders economic growth — is much higher than it was before the COVID pandemic, “and so we may be closer in a more neutral policy than we think.”

Bowman said she would be watching the data and has a wide range of contacts ahead of the Fed’s Dec. 17-18 meeting to assess the appropriateness of current policy and indicated she believes the central bank is not under pressure for another rate cut. , as the markets currently expect.

The biggest risk for the Fed is its goal of price stability, although worsening labor conditions are likely, he warned.