Fed’s Cook says she’d support rate hike if disinflation stalls
Federal Reserve Governor Lisa Cook said she is “prepared to act” if inflation remains too high above the Fed’s target rate.
Federal Reserve Governor Lisa Cook expressed her readiness to support rate hikes if US inflation does not fall below the Federal Reserve's 2% target. Speaking at a luncheon hosted by the Anchorage Economic Development Corporation, Cook stated that while certain disinflationary forces are present, she is prepared to act if disinflation stalls.
"Inflation is too high, and I consider the risks to the inflation side of the dual mandate higher than the risks to the employment side at this point," Cook said. She added that while she wouldn't place too much importance on a single data point due to the uncertain environment, the PCE index rose by nearly double its 2% target over the past year.
Cook emphasized that if she doesn't see continued disinflation soon, she's prepared to act. She explained that prolonged inflation above the target could become entrenched, making it much harder to address.
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