San Francisco Fed President Mary Daly said Monday night that after the Fed’s third consecutive rate cut, she feels comfortable with where the central bank is currently targeting interest rates.

“When you think about what to do next, I think that we’ve got the policy level right currently, given the headwinds we’re facing and the outlook we have against those headwinds,” Daly told reporters on the sidelines of an event at New York University. “This is the right level of policy.”

Daly added that it would take a “material change in the outlook” for her to consider more rate cuts, suggesting the Fed is comfortable with pausing on interest rate changes for now.

‘Downward pressure’ on inflation

At the event, Daly said inflation remains a challenging issue for the Fed, acknowledging that the central bank has undershot its 2% target. Although she acknowledged “downward pressure” on inflation, she said the “inflation anchor” has not fallen yet, suggesting that the Fed can still do more to prop inflation up.

“The new role of central banks is to fight inflation from below the target, not above the target,” Daly said.

Fed officials have recently noted that cutting rates does not appear to be creating the risk of runaway inflation, paving the way for some policymakers to make the case for more accommodation and allowing the U.S. economy to run “hot.”

Daly said she is comfortable with letting the U.S. economy run. She said the Fed’s efforts on extending the economic expansion, now the longest in history, are pulling in more sidelined workers into the economy and boosting wage growth for low- and middle-income communities.

“What these hot economies are doing is bringing in people that have been historically marginalized,” Daly said, echoing similar commentary from Fed Chairman Jerome Powell over the past few months.

On Oct. 30, the Fed lowered rates by 25 basis points for the third consecutive time. In that meeting, Powell pointed to remaining risk in the U.S.-China trade war and geopolitical tensions abroad to justify another rate cut that the Fed hopes will stave off concerns over a possible recession.

But that decision was not unanimous; two voting members dissented from the Oct. 30 decision, saying they would have preferred that the Fed held rates steady. Daly, who is not a voting member of this year’s Federal Open Market Committee, said Monday she was “very supportive” of all three rate cuts this year.

The target federal funds rate is now in the range of between 1.50% and 1.75%.

Among other things, Daly said the Fed is not currently considering negative interest rates and reiterated that the Fed’s efforts to grow its balance sheet is not quantitative easing because it is targeting short-term Treasury bills. Quantitative easing previously targeted long-term Treasuries, not T-bills, to alter the yield curve.