credit risks involved. on the other hand, the improvement in economic activities has not stimulated corporate demand for external funds, since firms ’ cash flow is at a high level in parallel with recovery in profits. moreover, firms continue to reduce their debts as part of their balance - sheet restructuring measures. as a result, credit demand in the private sector has continued to be basically stagnant. in view of this, the underlying tone of private banks ’ lending remains sluggish. recently, however, the expansion in the year - to - year decline seems to be ceasing. issuance of corporate bonds and cps has been steady. money stock ( m2 + cds ) grew faster in september compared with the previous month on a year - onyear basis. recently, funding costs for firms are somewhat increasing, due to the rise in money market rates after the termination of the zero interest rate policy. in this financial environment, there seem to be no substantial changes in the lending attitude of financial institutions and easing of corporate financing conditions.

and still remain somewhat restrictive to ensure inflation continues on the path to our 2 percent target. determining the appropriate pace at which to reduce policy restrictiveness will be challenging. choosing a slower pace of rate cuts gives time to gradually assess whether the neutral rate has in fact risen, but at the risk of moving too slowly and putting the labor market at risk. cutting the policy rate at a faster pace means a greater likelihood of achieving a soft landing but at the risk of overshooting on rate cuts if the neutral rate has in fact risen above its pre - pandemic level. this would cause an undesired loosening of monetary policy. determining the pace of rate cuts and ultimately the total reduction in the policy rate are decisions that lie in the future. as of today, i believe it is important to start the rate cutting process at our next meeting. if subsequent data show a significant deterioration in the labor market, the fomc can act quickly and forcefully to adjust monetary policy. i am open - minded about the size and pace of cuts, which will be based on what the data tell us about the evolution of the economy, and not on any pre - conceived notion of how and when the committee should act. if the data supports cuts at consecutive meetings, then i believe it will be appropriate to cut at consecutive meetings. if the data suggests the need for larger cuts, then i will support that as well. i was a big advocate of front - 4 / 5 bis - central bankers'speeches loading rate hikes when inflation accelerated in 2022, and i will be an advocate of frontloading rate cuts if that is appropriate. those decisions will be determined by new data and how it adds to the totality of the data and shapes my understanding of economic conditions. while i expect that these cuts will be done carefully as the economy and employment continue to grow, in the context of stable inflation, i stand ready to act promptly to support the economy as needed. 1 the views expressed here are my own and are not necessarily those of my colleagues on the federal reserve board or the federal open market committee. 2 the preliminary estimate of the annual benchmark revision to the establishment survey data, which was announced on august 21, suggests that payroll growth between april 2023 and march 2024 will likely be revised down early next year by about 68, 000 per month on average. the implications for payroll growth beyond march are less clear. 3 the 1981 – 82 recession was triggered by tight monetary policy in an