Federal Reserve Governor Cook: I will be prepared to support interest rate hikes if inflation fails to slow.
1 hours ago
Fed Governor Cook reiterated her stance, stating that if inflation does not slow, she is prepared to raise interest rates, warning that policymakers may not have the luxury of waiting for inflation to return to the 2% target. While Cook supported the Fed’s decision to hold interest rates steady at its July policy meeting, she cautioned that the longer inflation remains above the Fed’s target, the harder it will be to curb. Speaking at an event in Alaska, Cook said: “If I don’t see sustained signs of inflation moving down soon, I am prepared to act. With inflation running above the target for five consecutive years, the risk that inflation becomes entrenched in price and wage-setting behavior is rising, which will lead to more persistent inflation that is harder for us to address.” However, Cook noted that fading tariff impacts, the potential for lower oil prices, and easing pressures related to the AI boom could provide a buffer for inflation, eliminating the need for further policy tightening. She added that her top priority remains bringing inflation back to the Fed’s target level.
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