Musalem Warns of Additional Rate Hikes Amid Elevated Inflation Risks

Federal Reserve Bank of St. Louis President Alberto Musalem believes additional interest rate hikes may be necessary to curb inflation, which remains above the central bank's target.

In an interview with Reuters, Musalem stated that both persistent demand and recurring supply forces are contributing to elevated inflation risks, making it more likely for prices to remain substantially above the 2% target in 18 months.

Musalem also mentioned that monetary policy may still be stimulating the economy after this month's hike, suggesting that further restraint on inflation is needed. He emphasized that without additional policy measures, inflation will likely remain elevated.