Barkin Says US Economy Firming Up, but Inflation Remains Top Concern

Richmond Fed President Tom Barkin says the US economy is firming up, but inflation remains a top concern for the Federal Reserve. Inflation currently poses a greater threat than weakness in the labour market, according to Barkin.

Barkin notes that even temporary shocks have lasted longer than anticipated, creating more persistent price pressures. He adds that much of the Personal Consumption Expenditures Price Index is rising at an annual rate above 3%.

The Fed last week lifted its policy rate to a range of 3.75%-4.00%, with investors expecting further increases. Barkin's comments echo concerns among other Fed officials that inflation is being driven by strong demand across the economy, rather than just energy prices and tariffs.