Federal Reserve (Fed) Bank of Cleveland President Beth Hammack spoke at the bank's Financial Stability Conference on Thursday. She said that easing monetary policy now may encourage financial risk-taking.

Key takeaways

Easing monetary policy now may encourage financial risk-taking.

Risk management rate cuts could increase financial stability risks.

Cutting rates risks prolonging high inflation.

Cutting rates now could distort market pricing levels.

Financial conditions are ‘quite accommodative’ right now.

Stablecoins, private credit merit watching.

Financial system is in good shape.

Banks are well capitalized right now.

Sees elevated leverage levels in hedge funds, life insurers.

Household finances are in good shape.

Jobs report is 'a bit stale' but is in line with expectations - CNBC.

Jobs data looked a bit mixed.

Jobs data highlighted challenges faced by monetary policy.

Anecdotal info still points to low hire, low fire environment.

High inflation is still a real issue for economy.

We have a pretty good idea what's happening with inflation.

Sees some softening in demand related to inflation.

Inflation expectations have been contained and that's good.

Pressure from inflation is still really significant.

Goes into all Fed meetings with an open mind.

Fed has to balance both sides of mandate.

Inflation is still too high and trending in wrong direction.

Need to keep monetary policy somewhat restrictive due to inflation.

Had been anticipating cooling in jobs and data is confirming that.

Fed policy still needs to be positioned to lower inflation.

In housing, input costs are a real issue.

Expects to see fluctuations in money markets.

Would like to see standing repo facility used more.

Is looking a lot at private credit.

Generally feels good about private credit but it merits watching.

We are right around a neutral rate."