Collins Calls US Inflation Readings 'Mixed', Sees Gradual Disinflation Ahead
Boston Federal Reserve President Susan Collins described the latest US inflation readings as 'mixed' at the Fed's annual economic symposium in Jackson Hole, Wyoming. The Personal Consumption Expenditures Price Index rose at a 3.7% annual rate in July, exceeding the central bank's target.
Collins noted that while the overall number was higher than expected, once the data was unpacked, there were 'promising signs' including monthly inflation for goods and services where prices are set by market forces around the 2% target. She said her modal scenario still has gradual disinflation under current policy interest rates seen as slightly restrictive.
The Boston Fed research pointed to other reasons price pressures may ease, including improved productivity and indications that inflation linked to Trump administration's import tariffs may have almost run its course. Collins emphasized the need for a very broad-based elevation across market prices, which would be more concerning.