Richmond Fed President Thomas Barkin said in a podcast that “while the average (inflation) has dropped, the median has still stayed high”.

“That’s because the average has been distorted by falling prices for a few goods, like used cars, that escalated unsustainably during the pandemic,” he said.

“We have seen three good months on the inflation prints. I’d like to see them continue. Is inflation calming? That’s really the core question for this year,” he said.

“I think underneath that, I want to understand the labor market. Is it cooling? What’s happening to wages? What’s happened to employment?” he added. “Underneath that, I want to understand what’s happening to the broader demand, particular for companies who may or may not be thinking about increasing prices.

Full podcast here.

Fed Christopher Waller said in a speech that while some believe that inflation will come down quite quickly this year, “I’m not seeing signals of this quick decline in the economic data”.

“I am prepared for a longer fight to get inflation down to our target,” he added.

“Though we have made progress reducing inflation, I want to be clear today that the job is not done,” Waller said.

“It might be a long fight, with interest rates higher for longer than some are currently expecting. But I will not hesitate to do what is needed to get my job done.”

Full speech here.

Minneapolis Fed President Neel Kashkari said yesterday, “there’s not yet much evidence, in my judgment, that the rate hikes that we’ve done so far are having much effect on the labor market.”

“We need to bring the labor market into balance so that tells me we need to do more,” he added.

He noted that Fed will likely need to raise interest rates to around 5.4% in order to bring inflation down to the 2% target.

Fed Governor Lisa Cook said, “data are telling a pretty clear story of a historically strong labor market, with still elevated inflation.” But, Fed is “starting to seem some improvement in inflation data.”

She expects that inflation will “continue falling this year and next, though progress may be uneven.”

It’s “appropriate now to move in smaller steps as Fed assesses cumulative impact of rate increases so far,” She added. “Fed will stay the course until inflation is contained.”

Overall, the path of policy rates “will depend on how quickly inflation moves towards the 2% goal.”

New York Fed President John William said, that the December interest rate projection “still seems a very reasonable view of what we’ll need to do this year in order to get supply and demand in balance and bring inflation down.” Median projection was a peak rate of 5.1% by the end of this year.

He added that further increase of 24bps “seems like the right size”. But the pace would remain dependent on incoming data. “We still have our work cut out for us.”

“The Fed will watch the data to determine the path of rate rises,” Williams added. “Maybe services prices stay elevated, and if that happens we’ll need higher rates.”

Fed Chair Jerome Powell reiterated yesterday, “The disinflationary process, the process of getting inflation down, has begun and it’s begun in the goods sector. But it has a long way to go. These are the very early stages of disinflation.”

Regarding last week’s surprisingly strong non-farm payroll data, Powell said, “it is good that we have seen a very strong labor market”, and “we didn’t expect it to be this strong.”

But he declined to comment directly on whether the job data would affect the 25bps hike path. Powell said the data “shows you why this will be a process that takes a significant period of time,” when it comes to tightening monetary policy.

Minneapolis Fed President Neel Kashkari told CNBC, “We have a job to do. We know that raising rates can put a lid on inflation. We need to raise rates aggressively to put a ceiling on inflation, then let monetary policy work its way through the economy.”

Last week’s job data a “tells me that so far we’re not seeing much of an imprint of our tightening to date on the labor market. There’s some evidence that it’s having some effect, but it’s pretty muted so far,” Kashkari said.

“I haven’t seen anything yet to lower my rate path, but I’m obviously keeping my eyes open and we’ll see how the data comes in,” he added.