Fed's Hammack would prefer tighter policy given too high inflation

Core Viewpoint - Federal Reserve Bank of Cleveland President Beth Hammack prefers a tighter monetary policy to address high inflation levels [1][2][4] Group 1: Monetary Policy Stance - Hammack believes the current interest rate policy is around a neutral level and advocates for a slightly more restrictive stance to exert pressure on inflation [2][4] - She indicated that if she had a vote at the recent Federal Open Market Committee meeting, she would have opposed the decision to cut the interest rate target range by 0.25 percentage points to between 3.5% and 3.75% [3][4] - Hammack expressed skepticism about rate cuts given the persistent high inflation levels and highlighted the challenges of setting monetary policy in the current environment [4][6] Group 2: Inflation Concerns - Hammack noted that price pressures are a constant concern among her business contacts and that these pressures stem from factors beyond just tariff impacts [5][6] - She stated that if inflation remains elevated for an extended period, it may necessitate a reevaluation of the current policy stance, particularly if the labor market remains strong [6] Group 3: Future Leadership and Focus - Hammack will be a voting member of the FOMC next year and believes that the next central bank leader will continue to prioritize the goal of maintaining price stability [7][8] - She expressed confidence that the new chair will focus on achieving a 2% inflation objective [8]