Five of the Fed's 12 regional bank presidents have publicly voiced support for raising interest rates after the July policy meeting, signaling a growing hawkish tilt inside the central bank. Cleveland Fed President Beth Hammack said she favored a hike at the latest meeting, calling the current stance "not restrictive enough." Dallas Fed's Lorie Logan said core inflation remains near 2.5% even after stripping out recent shocks, backing tighter policy. Minneapolis Fed's Neel Kashkari argued for gradual tightening while more inflation and employment data arrives, saying "small, consecutive moves" are better than being forced into larger action later. Kansas City Fed's Jeff Schmid said strong demand and investment mean policy is not yet restrictive enough to hit the 2% target. St. Louis Fed's Alberto Musalem also backed a hike, warning that recent Treasury selloffs reflect doubts about Fed credibility and that persistent supply shocks are spreading price pressures. In contrast, seven Fed governors, New York Fed President John Williams and Philadelphia Fed President Patrick Harker have supported holding rates steady, underlining a clear split over the path ahead.
Five of the Federal Reserve's 12 regional bank presidents have publicly tilted toward raising interest rates after the July policy meeting, a sign that the hawkish camp is expanding inside the central bank.
Cleveland Fed President Beth Hammack said she favored a hike at the latest gathering because the current policy stance is "not restrictive enough." Dallas Fed President Lorie Logan, saying core inflation is still near 2.5% even when recent shocks are stripped out, backed a more restrictive course. Minneapolis Fed President Neel Kashkari argued for gradual tightening as more inflation and employment data come in, adding that "small, consecutive moves" are preferable to being forced into larger actions later. Kansas City Fed President Jeff Schmid said robust demand and investment mean current policy is not sufficiently tight, and achieving the 2% inflation target will require more tightening. St. Louis Fed President Alberto Musalem also supported a hike, warning that recent Treasury market selling reflects worries about the Fed's credibility and that persistent supply shocks are pushing broader price pressures onto households and businesses.
With those five officials, a clear rate-increase bias has emerged among the regional presidents. At the same time, seven Fed governors, New York Fed President John Williams and Philadelphia Fed President Patrick Harker have previously supported holding rates unchanged, underscoring a notable divide over the future policy path.
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