Fed Governor Barr: If inflation does not cool down, we should decisively raise interest rates

Federal Reserve Governor Michael Barr stated that the Fed should be prepared to raise interest rates if inflation does not decline.

He warned that the inflation rate has remained above target for more than 5 years, and there is a risk of entrenched price pressures. Barr indicated that if upcoming data shows inflation is cooling, policymakers can afford to be patient.

In a speech at an event in Washington on Tuesday, Barr said, "If the data trends give me confidence that inflation is easing and moving toward the 2% target, then I think we can take a little more time to assess the policy stance. But if inflation does not appear to be cooling sufficiently, then I think we should take decisive action to raise interest rates."