Fed's Hammack Calls for Raising Rates Amid Inflation Pressures

Cleveland Fed President Beth Hammack argues the Fed should raise rates because inflation has been above target for more than five years, the labor market is balanced, and financial conditions are not restrictive. She sees current higher yields as a return to normal rather than a panic and views interest rates as the clearest policy tool while balance-sheet transmission is uncertain. She declines to precommit on September but says every meeting is live and data dependent. - Hammack says inflation has missed the Fed's 2% target for more than five years and may end this year around 3%. - She believes policy is not restrictive and it is time to act by raising interest rates. - She sees capital markets as free-flowing and businesses as eager to invest, not restrictive. - She views interest rates as the clearest, most transparent policy tool and balance-sheet effects as uncertain. - She says current higher yields across the curve are normal rather than a reason to panic. - She says every meeting is live and data dependent, including September.