Fed’s Barkin: Inflation settling but job not done

Richmond Fed President Thomas Barkin, in an interview with Fox Business overnight, noted the positive aspects of the current economic situation, stating, the economy is “still growing” while unemployment is “still 3.9%”, and “inflation does to be settling”. “he added, “all that’s good”.

Despite these encouraging signs, Barkin emphasized that Fed’s work on bringing inflation down is far from complete. “But the job’s not done, and so you have to keep on until you get the job done, and we’ll see where we land,” he remarked.

Central to Barkin’s focus, and by extension, Fed’s, is the objective of returning inflation to the central bank’s target. “Inflation convincingly coming back to target — that’s my marker. And you can get there a lot of different ways,” Barkin elaborated.

He also expressed a desire to see a return to the pre-pandemic economic environment, where excessive price increases were not commonly used as a management strategy. “But I’m still looking to be convinced that price-setters in this economy have gotten back to where they were three or four years ago, which was an understanding that above-normal price increases just weren’t a management lever.”