NEW YORK (Reuters) -Federal Reserve Bank of St. Louis President Alberto Musalem said on Thursday the U.S. central bank has been right to cut interest rates to help the job market.

The cuts have been "appropriate" but "we have to be very careful to continue to lean against above-target inflation, while continuing to provide some insurance" to the employment sector, he said at a gathering of the Fixed Income Analysts Society in New York.

"Monetary policy is somewhere between modestly restrictive and neutral, and it's getting close to neutral in terms of financial conditions," Musalem said.

His assessment that financial conditions are helping the economy is based on a broad-based read on markets and credit availability, Musalem said. These conditions "are rather supportive of economic activity and rather supportive of the labor market as a ... byproduct of that," he added.

In late October, the Fed lowered its interest rate target by a quarter percentage point, to between 3.75% and 4%, after easing by the same amount in September. Fed officials believe inflation is too high but have lowered the cost of short-term credit to help support a job market that has cooled.

Musalem said U.S. trade tariffs have been drivers of inflation but their impact has been blunted as companies held off passing costs to consumers. He expects the impact will start to dissipate in the second half of next year, allowing inflation to restart its retreat back to the 2% target.

Musalem said his outlook is based on tariffs remaining in place. The legality of President Donald Trump's sweeping levies is being considered by the U.S. Supreme Court.