Fed Sees Inflation Risks Outweigh Employment Concerns Amid Rate Hike

The Federal Reserve is not yet satisfied that inflation has been tamed, according to Richmond Fed President Tom Barkin.

Barkin said that the risks to inflation outweigh concerns about maximum employment, and as a result, the central bank raised interest rates last week.

Inflation has been above the 2% target for five years, which contributed to the decision to hike rates. Barkin compared the Fed's dual mandate to raising children, saying that 'inflation is our troublemaker'.

Barkin noted that inflation could ease as price shocks fade or prove persistent, and while some of these recent shocks may reverse, others could drag on or develop into new cost pressures.