Federal Reserve's Goolsbee Highlights Inflation Concerns Amid Middle East Conflict

The President of the Federal Reserve Bank of Chicago, Austan Goolsbee, emphasized the need for the Federal Reserve to observe significant progress in reducing inflation before considering interest rate cuts this year. According to RTHK, Goolsbee noted that the ongoing conflict in the Middle East has negatively impacted the short-term economic outlook. Goolsbee pointed out that the inflation rate, as measured by the Federal Reserve's preferred indicators, is expected to be around 3% in February, marking five consecutive years above the target level. In an interview, he expressed concerns that the U.S. has not fully recovered from previous high inflation levels and is now facing rising energy prices due to the Middle East conflict, which could lead to another increase in inflation. He stressed the importance of the Federal Reserve carefully considering its policy options and determining the appropriate response to these challenges.