Chicago Federal Reserve President Austan Goolsbee said recent Consumer Price Index data has been encouraging, but he does not yet see enough proof to conclude inflation is moving steadily back to the Fed’s 2% target. He said inflation in the prior months, including May and June, had still been too high, and argued that policymakers would need to see another three to four months that follow June’s trend before gaining confidence that price pressures are truly cooling on a sustained basis.
Goolsbee said he supported keeping interest rates unchanged in July and described inflation as his biggest concern. At the same time, he said the broader economy and labor market have remained basically stable. He also warned that a continued decline in retail sales would be worrying because consumer spending is a key pillar of the U.S. economy.
He separately pointed to slowing productivity growth as another issue to watch. If AI-driven growth fails to hold up, he said, the narrative around artificial intelligence and monetary policy would need to be reconsidered. On the question of reducing the number of policy meetings, Goolsbee said he does not hold a strong view and is willing to wait for recommendations from the working group.
Chicago Federal Reserve President Austan Goolsbee said recent CPI data has been encouraging, but more evidence is still needed before officials can conclude that inflation is steadily returning to the Fed’s 2% target.
According to BlockBeats, Goolsbee said inflation readings in the earlier period, including May and June, were still elevated. He said policymakers would need to see another three to four months that continue June’s momentum before they can be confident that price pressures are moving lower in a durable way.
Goolsbee also said he supported holding rates unchanged in July, adding that inflation remains his top concern. He described the economy and employment conditions as basically stable.
He warned that a continued decline in retail sales would be a concern because consumption is a key pillar of the U.S. economy.
Separately, Goolsbee said he is paying attention to the recent slowdown in productivity growth. If growth driven by AI cannot be sustained, he said the narrative tying AI to monetary policy would need to be revisited.
On whether the Federal Reserve should reduce the number of policy meetings, Goolsbee said he has no strong opinion and is willing to wait for recommendations from the working group.
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