Minneapolis Fed President Neel Kashkari said yesterday, “I’ve said publicly that I could easily see us getting into the mid-4%s early next year.”

“But if we don’t see progress in underlying inflation or core inflation, I don’t see why I would advocate stopping at 4.5%, or 4.75% or something like that,” he added. “We need to see actual progress in core inflation and services inflation and we are not seeing it yet.”

“That number that I offered is predicated on a flattening out of that underlying inflation,” Kashkari said. “If that doesn’t happen, then I don’t see how we can stop.”

Dallas Fed President Lorie Logan said it’s a “good idea to slow down” in “today’s complex economic and financial environment”.

“That’s why I supported the decision last month to reduce the pace of rate increases. And the same considerations suggest slowing the pace further at the upcoming meeting,” she added.

“A slower pace is just a way to ensure we make the best possible decisions,” she said. “We can and, if necessary, should adjust our overall policy strategy to keep financial conditions restrictive even as the pace slows.”

She added that Fed should not “lock in” on a terminal rate. “My own view is that we will likely need to continue gradually raising the fed funds rate until we see convincing evidence that inflation is on track to return to our 2 percent target in a sustainable and timely way,” she said.

“The most important risk I see is that if we tighten too little, the economy will remain overheated, and we will fail to keep inflation in check,” Logan said.

St. Louis President James Bullard said in a Bloomberg TV interview that “It’s too early to talk about changing monetary policy.” Policymakers want to “stay with our very easy monetary policy while we are still in the pandemic tunnel”. “If we get to the end of the tunnel,” he added, “it will be time to start assessing where we want to go next.”

“When you start to get to 75% vaccinated, 80% vaccinated and CDC starts to give more hopeful messages that we are bringing this under better control and starts relaxing some of their guidelines, then I think the whole economy will gain confidence from that,” Bullard said. “Cases are up right now, that is a little bit concerning.”

Fed Vice Chair Richard Clarida said the US economy begins 2020 “in a good place”. PCE price inflation is “running somewhat below” the 2% target. But Fed projects that inflation will “rise gradually” back to the 2% symmetric objective. Meanwhile, there is no evidence that a strong labor market is “putting excessive cost-push pressure on price inflation”.

Over the course of 2019, FOMC shifted the monetary stance to “offset some significant global growth headwinds and global disinflationary pressures.” Such shift was “well timed” and has helped keep the outlook on track. ” As long as incoming information about the economy remains broadly consistent with this outlook, the current stance of monetary policy likely will remain appropriate.”

Monetary policy is “not on a preset course”, he added. “if developments emerge that, in the future, trigger a material reassessment of our outlook, we will respond accordingly.

Clarida’s full speech here.