Chicago Federal Reserve Bank President Austan Goolsbee said he is encouraged by the recent slowdown in inflation, but he would like to see this trend continue in the coming months to be confident it returns to the central bank’s 2% target.
Goolsbee said in an interview with Bloomberg News on Friday that this summer’s inflation readings, based on the consumer price index, are giving reason for optimism. “However, given that for five or six months things were not moving in our favor, and overall inflation is too high, I have to say the last three months encourage me,” Goolsbee said. — “If we see three or four months in a row at the same level as June, I’ll feel much better, understanding that we’re on the path back to the level of 2%.”
The Chicago Fed chief, who said he supported the decision to keep interest rates unchanged at the July meeting, called inflation his main concern at the moment. As for growth and the labor market, he added, the U.S. economy is “mostly stable.”
“I think we need to be a little more cautiousa and pay a little more attention to what’s happening on the inflation side, because over the past five years we’ve seen that once you get inflation started, getting rid of it can be painful and difficult,” Goolsbee said.