Fed Officials Urge Rate Hike Amid Persistent Inflation

Three Federal Reserve officials have publicly called for a rate hike as inflation persists in the US. Beth Hammack, President of the Federal Reserve Bank of Cleveland, Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, and Lorie Logan, President of the Federal Reserve Bank of Dallas, all issued statements arguing that the benchmark interest rate should be raised by 0.25 percentage points.

Hammack pointed out that current monetary policy is not sufficiently restrictive to cool the pace of inflation, stating 'The longer high inflation persists, the more costly and difficult it becomes to bring it back down.' She emphasized the need for action to quickly return personal consumption expenditures (PCE) inflation to its 2% target.

Kashkari also warned that waiting could lead to entrenched inflation, saying 'To prevent the risk of inflation becoming entrenched, it is better to carry out a series of small rate hikes than to wait and watch the situation further.'