April 2 (Reuters) - Federal Reserve Bank of San Francisco President Mary Daly on Tuesday said she believes three interest-rate cuts this year is a "reasonable" expectation, with the Fed ready to do less if inflation stays sticky or more if the labor market falters or inflation falls faster than anticipated. "Standing pat is the right policy for the moment," Daly said at an event in Las Vegas, Nevada.
Daly joined other Fed policymakers last month in voting to keep short-term interest-rates in the 5.25%-5.5% range to keep downward pressure on inflation, down from its mid-2022 highs but still above the Fed's 2% target.
"At this point, the economy and policy are in a good place," Daly said. "Inflation is coming down, but it's slow, it's bumpy and slow. The labor market is still going strong and growth is going strong. So there's really no urgency to adjust the rate."
Fed policymakers as a group project three quarter-point interest rate cuts this year, though nearly half of officials -- nine of the 19 -- see two or less this year, according to forecasts published last month.
"I think that is a very reasonable baseline, but I would like to say here that this is a projection," Daly said. "A projection is not a promise."
There is a "real risk," she said, of cutting rates too soon and locking in too-high inflation.
"We have to be ready for, what if inflation is stickier than we projected or I projected...we may want to cut less," she said. "What if the labor market starts to falter or inflation comes down more rapidly? Well, then we might be in a position where we would think cutting more is appropriate."
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Reporting by Ann Saphir; Editing by Chizu Nomiyama
