Federal Reserve Bank of St. Louis President William Poole said on Friday that interest rates are about right and if the Fed decides to cut again, it ought be confident it will not have to quickly reverse course.

"I think that, given the information set that we have, we are approximately in the right place," Poole, a voting member of the Fed's interest rate setting committee this year, told Reuters in an interview. The next meeting is on Oct. 30-31.

"If I thought that we were way off the right place, what evidence would I offer? Well, I think the market would be looking at the same thing that I'm looking at, and then we wouldn't be there, we'd be in a different place," he said.

Poole said it was still too early to tell if there had been spillovers from the housing slump to the broader economy, although recent economic indicators had been "OK" while inflation was creeping lower.

"We are in a situation of unusual uncertainty because we have this market upset and we don't know how far along the healing process is...It is not exactly business as usual," Poole said. Problems in the subprime U.S. mortgage market sparked a global credit crunch in August.

But Poole said that because of the importance of the predictability of policy actions, the Fed had to be pretty sure that any decision to lower borrowing costs was founded on solid expectations about the economic outlook. Otherwise, just wait.

"One of the considerations is that if we change the rate, are we likely to be perfectly happy to keep it there the next time? And if you say 'I'm not sure about that', then it would be better to wait rather than change it, because you can't have policy reversals. It is very confusing," Poole said.

"If you are going to favor a cut, you are going to say, not only do I think a cut is appropriate now, but with high probability I'm not going to regret that decision," he said.

"I want to be sure that if I turn out to favor lower rates, which I might, I don't know where I stand on this...this is part of a regularity of policy behavior," he said.

The Fed cut it benchmark fed funds rate by an unexpectedly bold half percentage point to 4.75 percent on Sept. 18. Investors had been divided on whether it would cut by another quarter point at the end of this month, although a sharp fall on Friday in Wall Street stocks tilted the odds heavily toward another easing.

Poole was not talking about the most recent moves in the interest rate futures market when he gave the interview, rather he was explaining how he thought policy-makers should always approach an interest rate decision.

On the other hand, he was also emphatic that the judgment of the market should not push the Fed one way or the other.

"We should never think of our job as being to ratify what the market has built in...our job is not to ratify the market. Our job is to set a clear policy path, that the market understands," he said.

Economists say the Fed's view on whether to keep cutting rates, or hold off to see how the economy performs, will be shaped by its estimate of the odds that growth is coming in around its already more subdued forecast, or getting worse.

Poole said monthly U.S. job data for August and September "does not provide evidence of a recession," while the weakness in housing shown in recent data was not really a surprise, given the big problems in that sector.

"Consumption is not going gangbusters, but it is OK.. That picture may change by the next meeting," he said.

"I'm not saying that we are out of the woods. I'm saying that I don't see firm evidence in either direction," he said.