Fed's Collins: Without Sustained Evidence of Inflation Easing, It's Appropriate to Raise Rates "Promptly"

August 25 news, according to Jinshi Data, Fed's Collins stated: Inflation remains too high, with concerns over the Fed's mandate to maintain price stability. The labor market is consistent with full employment; the economy is growing at a pace near its trend rate. The coming months will focus on evidence of whether inflation can sustainably return to 2%. Given limited additional tariffs and progress on reopening the Strait of Hormuz, a decline in inflation is the most likely outcome. Higher long-term interest rates should have a dampening effect on any reacceleration of demand. There are also some less optimistic scenarios, including rising inflation due to AI construction and supply shocks. Attention will be paid to whether productivity helps offset inflation, as well as changes in oil prices and inflation expectations. Maintaining the current policy rate requires sustained evidence that inflation is declining. Without sustained evidence of inflation easing, it is appropriate to raise rates "promptly."