Fed's Goolsbee backs rate cuts after warning some economic data 'flashing yellow'

Investing.com -- Chicago Federal Reserve President Austan Goolsbee threw his weight behind rate cuts on Friday after warning that a range of economic indicators including rising unemployment and tight credit conditions are "flashing yellow"

" If we move toward less restrictiveness, it will help ease some of these credit conditions," Goolsbee said after suggesting credit conditions appear tight and flagging some economic factors that are "flashing yellow."

Goolsbee outlined a myriad of issues of concern including rising unemployment and small business defaults.

"Small business defaults are increasing ... this is becoming a cause for concern," he said, adding that rising unemployment is a "warning sign."

The Chicago Fed president said that the speed of transmission of lower rates will "depend on many factors," but signaled support for a "gradual" rather than fast pace of rate cuts.

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