Fed Officials Sound Alarm on Inflation as Jackson Hole Conference Kicks Off

At the Jackson Hole conference in Wyoming, three Federal Reserve officials expressed concerns about inflation. Kansas City Fed President Jeffrey Schmid stated that inflation is 'still stubborn and it's still sticky' and that they need to find ways to bring it back down to 2%. He noted that the current policy rate of 3.50%-3.75% does not appear restrictive.

Schmid seemed to suggest that he would favor raising rates to help bring inflation down, but said they need more information about the demand side of growth and inflation. Cleveland Fed President Beth Hammack was also anxious about inflation and reiterated her willingness to act to bring price pressures back in line.

Hammack stated that inflation has been above target for over five years and that monetary policy is not doing anything to restrain the economy and lower price pressures. She fears the longer this trend continues, the greater the risk to the central bank's credibility.