New York Fed President John Williams, the third-ranking official of the Federal Reserve, expressed support for further rate cuts this year, despite inflation having deviated from the Fed's 2% target in recent months. His rationale revolves around the already cracked labor market, which Williams hopes to prevent from deepening. He cited slowing monthly job growth and other signs of businesses being more hesitant to hire as reasons for concern. Williams said the Fed has flexibility to support the labor market because the inflation outlook appears less dire than earlier this year. Williams said Trump's tariffs have indeed pushed up prices for some consumer goods, but he expects the impact on inflation to diminish over time, despite the new import taxes Trump has imposed on products such as furniture and pharmaceuticals. Williams said the risk of a further slowdown in the labor market is a significant concern. If the economy develops as expected, with inflation rising to around 3% and the unemployment rate slightly above the current 4.3%, he would support a rate cut this year, "but we have to see what that means." (Jinshi)