Fed Officials Sound Alarm on Persistent US Inflation

At the annual Jackson Hole economic symposium, Federal Reserve officials expressed concerns about persistent US inflation. Kansas City Fed President Jeffrey Schmid called inflation 'stubborn' and questioned whether the current benchmark rate of 3.5% to 3.75% is restrictive enough. He needs more data before deciding on a rate increase at the September 15-16 meeting.

Cleveland Fed President Beth Hammack also supported tighter monetary policy, saying inflation has stayed above the central bank's 2% target for over five years. She projected that inflation would finish 2026 near 3% and could fall into the mid-2% range next year.

Boston Fed President Susan Collins described recent inflation data as mixed but still expected gradual disinflation. The Fed's preferred inflation gauge, the Personal Consumption Expenditures (PCE) Price Index, rose 3.7% in the 12 months through July, down from 4.1% in May.