Fed Governor Adriana Kugler expressed growing concern over the recent behavior of inflation. Speaking today, she highlighted that some inflation subcategories “reaccelerated in recent months.” In particular, goods inflation, which had been negative in 2024 but has recently turned positive.
She warned that this shift is “unhelpful” as goods inflation “has often kept a lid on total inflation and also affects inflation expectations”.
Kugler added that surveys are now pointing to rising inflation expectations among consumers too, with much of the uncertainty tied to ongoing trade policy developments.
Despite these concerns, Kugler reaffirmed confidence in the current policy stance, describing it as restrictive while Fed is “well positioned.
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