Fed's Hammack says tighter policy may be needed to curb inflation

The short version

• CNBC reports Cleveland Fed President Beth Hammack said tighter monetary policy may be needed to bring inflation down.[CNBC]
• Hammack prefers smaller, quicker policy adjustments and called a restrictive stance appropriate for a timely return to 2% inflation.[CNBC]
• She warned that persistent inflation raises the risk of an inflationary mindset becoming entrenched and expects progress toward 2% to take time.[CNBC]
• Next unknown: September minutes signaled possible rate hikes without timing, while traders priced a likely hold at this month's meeting.[CNBC]

Key facts

• Hammack said tighter monetary policy might be needed to bring inflation down and that the Fed should make fast, incremental adjustments.[CNBC]
• Hammack said a restrictive monetary policy stance is appropriate to ensure a timely return to 2% inflation.[CNBC]
• The personal consumption expenditures price index was 3.4% year over year in August.[CNBC]
• The core PCE price index, which excludes volatile food and energy costs, was 3% compared with a year earlier.[CNBC]
• Fed officials signaled in September meeting minutes that they could vote to raise rates again but gave no clear timing.[CNBC]
• Traders priced a more than 78% likelihood that the Fed keeps rates unchanged at its meeting later this month, according to CME's FedWatch tool.[CNBC]

Sources

Outlet counts describe coverage, not independent confirmation. Reports may share a wire service or original source.

• Higher rates could be needed to avoid 'inflationary mindset' taking hold, says Fed's HammackCNBC