Chicago Fed’s Goolsbee Says Inflation Pressures Are Broadening, More Persistent Than Expected

Summary

• Austan Goolsbee, president of the Chicago Fed, said inflation is proving far more persistent than expected.
• He said inflation is spreading beyond categories tied to energy prices, and that expanded data-center construction is fueling price gains.
• He also said the Fed still has clear work to do to maintain its credibility.

Forecast Trend Report by Period

Austan Goolsbee, president of the Federal Reserve Bank of Chicago, said inflation is proving more persistent than expected, underscoring continued concern about rising prices.

According to First Squawk on November 13, Goolsbee told CNBC that inflation is rising and has turned out to be far more persistent than earlier expectations that treated it as a simple supply shock.

He added that inflation is spreading to categories unrelated to energy prices. If demand is overheating, inflation cannot be dismissed as a temporary phenomenon, he said.

Goolsbee also pointed to expanded data-center construction as a factor adding to price pressures. On the labor market, he said wages are a lagging indicator, so policymakers should be cautious when assessing how labor-market conditions affect inflation.

He added that the Federal Reserve still has work to do to maintain its credibility.

Uk Jin