Svmuu News Federal Reserve Daly said inflation should begin to slow, but there is significant uncertainty surrounding the economic outlook.Speaking Thursday at a Bank of Spain event in Santander, Spain, Daly said, “We continue to maintain policy at a slightly restrictive level, so inflation should come down.” Daly noted that rising tariffs and oil prices this spring pushed up inflation following the U.S. military action against Iran.
She welcomed the easing of the surge in oil prices following the U.S.-Iran ceasefire agreement, calling it a “sign of relief,” but warned that it remains unclear how the economy will evolve. She outlined various scenarios that might require Federal Reserve to respond differently, and indicated that Federal Reserve may need to take a more proactive stance in the face of persistent inflation.
Daly also noted that she is open to adopting different and innovative approaches to assessing the economy, but emphasized that, for the credibility of Federal Reserve, it is important not to alter its dual mandate of promoting full employment and price stability. (Jin Shi)