Fed Governor Cook: Prepared to hike rates if inflation persists

Federal Reserve Governor Lisa Cook stated on May 27 that she is prepared to raise interest rates if inflation continues to move in the wrong direction. Speaking at a Stanford University event, Cook noted that while her current inclination is to hold borrowing costs steady and she anticipates price increases will slow again in the coming months, the risks remain tilted toward higher inflation. She pointed out that with inflation running above the Fed's 2% target for five years, there is a danger of price pressures becoming entrenched in wage and price-setting behavior. Cook reiterated her readiness to hike rates if the expected disinflation does not materialize in a timely manner. Her comments align with the view of many Fed officials who consider accelerating inflation a greater policy concern than the labor market.