TLT•Richmond Fed President Tom Barkin said the central bank should move policy “with care” as it responds to inflation, which he called its greatest risk. Investors expect a rate increase at the Fed’s December 8-9 meeting.
Businesses continue to face rising costs and are planning to try to pass them along, Barkin said. After nearly six years of inflation above the Fed’s 2% target, he said the risk lies on the inflation side of the central bank’s dual mandate.
Barkin said healthy demand and stubbornly elevated inflation point toward tighter monetary policy, but warned that risks to employment call for care. If AI underdelivers, it could curb business investment, stock prices and consumer spending; if it overdelivers, it could displace more workers than expected.
