Atlanta Fed President and FOMC member Raphael Bostic said on Tuesday that the US will be "hard-pressed" to get inflation back below 3.0% for all of 2022, reported Reuters. However, Bostic said he remained optimistic that Fed actions will produce steady movement of inflation back to the bank's 2.0% target.
Separately, Bostic warned of significant upwards pressures on energy prices. The labour market is sending a strong signal that the US economy can stand on its own without central bank support, Bostic added. Bostic continued that he is not seeing a shift in long-run inflation expectations, or any evidence of a wage-price spiral in the economy.
Bostic said that he is open to four quarter-point rate hikes this year if inflation continues to surprise on the high side. However, "everything is on the table" if data points to a need for more frequent rate increases, or in larger increments than a quarter point.