Another Fed Official Joins Schmid in Warning That Inflation Persists

Chicago Federal Reserve President Austan Goolsbee said his biggest short-term concern remains that inflation is not under control, adding to warnings from other Federal Reserve officials that price pressures remain above the central bank's target, Michael S. Derby reported for Reuters.

Chicago Federal Reserve President Austan Goolsbee says inflation remains a major short-term concern as policymakers assess the path of US interest rates. [Photo: Federal Reserve Bank of Chicago Facebook]

“Everybody should be on edge, and I would say my biggest fear in the short run continues to be that inflation is not under control,” Goolsbee said on the Rapid Response podcast.

He warned that renewed inflation could make affordability problems worse and become increasingly difficult to reverse.

Goolsbee pointed to rising energy costs associated with the conflict in Iran and uncertainty surrounding tariffs under the Trump administration as additional inflation risks.

He said those pressures are affecting households while inflation remains above the Federal Reserve's target.

At the same time, Goolsbee did not characterize all recent inflation data as negative.

He said the recent three-month inflation trend “doesn't look terrible” and indicated that interest rates could eventually be lowered if there were evidence that inflation was moving back toward the Fed's 2% target.

The comments came as Federal Reserve officials gathered for the annual economic symposium in Jackson Hole, Wyoming.

Other officials, including Kansas City Fed President Jeff Schmid and Cleveland Fed President Beth Hammack, also expressed concern that inflation remains too high and that monetary policy may not be sufficiently restrictive.