Federal Reserve Vice Chair for Supervision Michelle Bowman said the central bank should be ready to cut interest rates again if needed. Speaking at an economic forum in Massachusetts, she described current policy as "moderately restrictive" and warned the job market could deteriorate further.

Bowman stressed that without a clear improvement in labor conditions, the Fed must be prepared to adjust policy closer to neutral. She noted the dual mandates of price stability and maximum employment face uneven risks, with job market concerns outweighing inflation worries for now.

While inflation pressures are expected to ease, Bowman emphasized policymakers should be forward-looking and avoid signaling a pause on cuts without evidence of changing conditions. Her remarks suggest the Fed remains data-dependent, watching for signs that the labor market stabilizes or weakens further.