United States Federal Reserve Bank of Richmond President Thomas Barkin underscored on Wednesday that the Fed remains committed to achieving the 2% inflation target, revealing that more interest rate hikes are likely to be announced in the coming period.
Barkin explained that inflationary pressures caused by the pandemic and supply chain disruptions prompted the Federal Reserve to raise the federal funds rate by 225 basis points overall, noting that the rising prices are expected to fall as demand flattens, supply chains improve, and commodity pressures ease.
However, Barkin warned that a recession could occur as a result of the effort to combat inflation, but emphasized that fears of an economic slowdown are "a little inconsistent" with an economy adding nearly 400,000 jobs per month and unemployment near "a historic low" of 3.6%.
