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Fed's Daly says she's in a 'watch and see' mode on rates

By Praveen Menon

By Praveen Menon

WELLINGTON, New Zealand, Aug 29 (Reuters) - San Francisco Federal Reserve President Mary Daly on Thursday said she is in a "watch and see" mode as she assesses the need for another U.S. interest-rate cut, but said she believes acting early is better than waiting too long.

"I'm convinced using our tools early and pre-emptively is better than waiting," Daly told reporters after a speech in Wellington, New Zealand. "Better to avoid the ditch rather than digging yourself out of the ditch."

Daly, who supported the Fed's interest-rate cut last month, said she believes the U.S. economy has "strong" momentum, but uncertainty and a global growth slowdown are having an impact.

Asked if she believes U.S. monetary policy is too tight, she said "I'm in a watch-and-see position right now." (Reporting by Praveen Menon in Wellington; writing by Ann Saphir in San Francisco; Editing by Sandra Maler)