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(Adds comments from Evans, market slide, background)
CHICAGO, Aug 7 (Reuters) - The U.S. Federal Reserve has eased policy substantially since late last year, but sluggish inflation and concerns over the trade outlook could mean more interest rate cuts are needed, Chicago Fed President Charles Evans said on Wednesday.
"You could take the view, as I have, that inflation alone would call for more accommodation than we put in place with just our last meeting," Evans told reporters in an annual interview in Chicago.
But the economy, though fundamentally "good," faces more risks than just inflation that is too low, he said, including "brinkmanship" U.S. trade negotiations with China that create volatility and uncertainty for businesses.
"You might take the view that things have perhaps created more headwinds against that, and it would be reasonable to do more ... I don't know," he said, adding that he'll be looking at data and business commentary to assess that.
Risk management concerns - the idea that the Fed needs to apply more firepower earlier on against a potential downturn when rates are closer to zero - could also argue for more policy accommodation, he said.
Evans voted with the majority on the Fed's policy-setting committee last week to cut rates by a quarter of a percentage point to a target range of 2.00% to 2.25%, and said before the meeting that rates ought to be another quarter of a point lower by the end of the year to help boost inflation back to the Fed's 2% annual target.
He repeated that view on Wednesday, and while he said he expects U.S. GDP to grow about 2.25% this year and continues to see a good labor market, he added that "if the labor market starts to slow or does something else, that's going to be a risk, because the consumer has been the lynchpin of growth."
He's particularly focused on whether businesses, already cutting back on investments because of trade uncertainty, could pare hiring as well.
Evans said he viewed last week's rate cut as part of a "mid-cycle" adjustment to policy, from aiming at a slightly restrictive stance of perhaps 3.25% to now aiming for an accommodative policy, perhaps 50 basis below Evans' estimate of a 2.75% neutral rate, he said.
That's a "substantial" move that he said will help mitigate headwinds from uncertainty over trade negotiations and the fallout for business confidence and investment.
"Is it enough? I wont know until I look at the data," he said.
But uncertainty caused by the U.S. trade war with China as well as related global developments are adding up. Three central banks in Asia cut interest rates overnight, with unexpectedly big reductions in India and New Zealand.
"I did take note," Evans said. "We are going to be digesting everything that's going on."
U.S. stocks on Wednesday resumed a slide that began last week after U.S. President Donald Trump announced he would slap a 10% tariff on $300 billion in Chinese imports starting Sept. 1, part of his campaign to pressure Beijing into signing a trade agreement with the United States.
Trump has accused the Fed of undercutting his efforts to boost economic growth by keeping monetary policy too tight. He tweeted early on Wednesday that the Fed should deliver "bigger and faster" rate cuts to help U.S. companies compete globally.
Interest rate futures traders are currently pricing in quarter-point rate cuts at each of the Fed's next three policy meetings.
Evans, one of the longest-serving policymakers at the U.S. central bank, said he can see the case, made by some of his colleagues, that current policy is enough to get inflation back to 2%. But his own view is that it would be better to get inflation up to and beyond the 2% target faster.
"As long as inflation continues to behave the way that it has, I think we have capacity to pursue these accommodative stances in support of the economy and sustaining the expansion and maximum employment," he said. (Reporting by Ann Saphir Editing by Paul Simao)