Goolsbee: US Inflation Data Shows Improvement, Economy May Return to 2%

Chicago Federal Reserve Bank President Austan Goolsbee expressed optimism about recent U.S. inflation data, indicating that it shows some improvement. He believes that if certain factors affecting inflation can be left behind, the economy will return to a 'golden path,' where inflation hovers around 2%. Currently, the overall inflation rate is at 3%, which Goolsbee considers too high.

The Federal Reserve maintained its short-term policy rate between 3.50% and 3.75% last month, with at least five of its policymakers wanting to raise rates instead. The Fed's target inflation rate is 2%, measured by the 12-month change in the personal consumption expenditures price index.

June's PCE inflation stood at 3.7%, down from May's peak of 4.1%. This decline, combined with a recent weak jobs report and consumer/producer price inflation data in July, has largely eliminated expectations of an imminent Fed rate hike.