(Bloomberg) -- Federal Reserve Bank of Chicago President Austan Goolsbee said he sees interest rates moving “a fair bit lower,” while expressing confidence inflation is easing toward the central bank’s objective alongside a solid labor market.

Most Read from Bloomberg

• Trump Promises Could Have Seismic Impact on Washington Economy

• Paris to Replace Parking Spaces With Trees

• Tokyo’s Scorching Summers Focus Public Anger Against Tree Cutting

• NYC Mayor Adams Names Jessica Tisch to Lead Police Head Amid Probes

• New York’s Transit Agency Approves $9 Congestion Toll

“My view is that the long arc over the last year and a half shows inflation is way down and on its way to 2%. Labor markets have cooled to something close to stable full employment,” Goolsbee outlined in talking points for a moderated Q&A event in Indianapolis on Thursday.

“Things are getting close to where we want to settle on both counts,” he said. “It follows that we will probably need to move rates to where we think they should settle, too.”

Goolsbee said policymakers don’t need to get rates to that place immediately, “but if we look out over the next year or so, it feels to me like rates will end up a fair bit lower than where they are today.”

Fed officials lowered the central bank’s benchmark interest rate by a quarter-percentage point earlier this month, following a half-point reduction in September. Investors have pulled back expectations for another cut when officials next meet Dec. 17-18, and now see just above a 50-50 chance for a reduction.

The pared bets follow data showing a measure of underlying inflation remained sticky in October, along with comments from Fed Chair Jerome Powell and other officials calling for a careful approach to future rate cuts.

Some officials have also said uncertainty about the so-called neutral policy rate, one that neither promotes nor inhibits economic activity, calls for cautious adjustments of policy. Fed Governor Michelle Bowman said Wednesday she estimates the neutral rate is much higher than it was before the Covid-19 pandemic, and so “we may be closer to a neutral policy stance than we currently think.”

Goolsbee on Thursday said it “may make sense to slow the pace of rate cuts as we get close” to where rates will eventually settle. During the Q&A, he said policymakers will eventually need to figure out where the neutral rate is, but noted it’s “a long way below where we are right now.”

He added that if the government enacts laws or makes decisions that affect employment or prices, policymakers will consider those factors like any other. The comment comes as many expect the incoming Trump administration to deliver tax cuts, restrain immigration and deploy tariffs.