WASHINGTON, 13 Nov (Reuters) – The president of the Federal Reserve Bank of Chicago, Austan Goolsbee, said on Friday that inflation above the Fed’s 2% target went beyond potentially temporary shocks in energy costs and tariffs, with the expansion of AI forcing price increases through strong demand, and many services and health care also recording price increases that go beyond what could be explained by oil costs or import taxes.
“Are we on the path back to 2%? My impression is that, at this moment, we are not and we need to deal with it,” Goolsbee said on CNBC’s Squawk Box.
“Common sense says to do whatever it takes to prevent overheating demand,” he added, noting that the upcoming inflation data will be crucial in determining whether the Fed needs to accelerate the pace of rate hikes.
