Fed’s Daly on Inflation: Progress made, but more work needed

San Francisco Fed President Mary Daly commented on the CPI report released today, calling it “good news” but also noting that inflation remains elevated. She said, “Headline release showed that it’s going down, it’s going in the right direction, but it’s still elevated. It’s not consistent with price stability.” Daly emphasized her focus on core services, particularly core services minus housing, in assessing inflation trends.

Daly also commented on the labor market, observing signs of cooling but noting that it remains extremely tight, with a gradual return to balance expected. Overall, she stated, “The strength of the economy and the elevated readings on inflation suggest that there is more work to do,” adding that the extent of this work depends on several factors with considerable uncertainty.