Paulson Keeps Open Mind on Rate Policy Amid High Inflation Concerns

Federal Reserve Bank of Philadelphia President Anna Paulson expressed her commitment to keeping an 'open mind' on monetary policy amid high inflation. In a statement, she said that while recent improvement in some inflation data is welcome, it's only one step towards achieving the Fed's 2% inflation target.

Paulson supported the decision to hold the overnight interest rate target range steady at between 3.5% and 3.75%, but acknowledged that inflation pressures remain above target. She noted that if underlying inflation remains elevated, more restrictive policy may be needed.

Paulson's statement comes after last week's Federal Open Market Committee meeting, where officials held their interest rate target range steady amid inflation concerns. Three officials dissented and voted in favor of a rate hike, citing the persistence of inflation above target.