San Francisco Fed President Daly Downplays Statement Divide, Signals Caution on Energy Shock on May 8

According to San Francisco Federal Reserve President Mary Daly on May 8, the Fed’s statement language matters less than its actions, with the true signal being unanimous agreement on policy decisions. Daly downplayed recent disagreement among officials over forward guidance on rate cuts, noting that energy price shocks and Iran conflict uncertainty do not yet show signs of pushing medium or long-term inflation expectations higher. She stated that policy is “slightly restrictive” and emphasized the importance of not overreacting to energy disruptions. If the conflict resolves and oil prices decline without broader economic transmission, she expects the economy to return to pre-conflict dynamics.