(Reuters) -The U.S. central bank should move cautiously on further interest rate cuts, Federal Reserve Governor Michael Barr said on Thursday in a speech that leaned heavily into the risks of inflation, even as he acknowledged the potential vulnerabilities in a “roughly balanced” labor market.

“The FOMC (Federal Open Market Committee) should be cautious about adjusting policy so that we can gather further data, update our forecasts, and better assess the balance of risks,” Barr said in remarks prepared for delivery to the Economic Club of Minnesota, his first on monetary policy since June.

With both upside inflation risks and downside risks to the labor market, the Fed is in a “challenging position” with no risk-free path forward as it sets monetary policy, Barr said, explicitly borrowin

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