Fed's Barr says further policy adjustments likely needed

Federal Reserve Governor Michael Barr said further monetary-policy adjustments are likely needed to bring inflation back to the central bank’s 2% target, arguing that persistent price pressures warrant greater attention while the labor market remains solid. He did not specify when or by how much rates should rise, leaving the timing of any next increase unresolved. Speaking Tuesday, September 29, at the Detroit Economic Club, Barr said inflation had not shown a clear trend toward a timely return to the Fed’s goal. He cited higher energy prices linked to conflict in the Middle East and rising demand associated with artificial intelligence investment, including demand for computer chips, as factors that have hindered progress. He also pointed to tariffs as part of the recent inflation backdrop. The Fed raised its benchmark target range by a quarter percentage point on September 16, to 3.75% to 4.00%. Barr’s remarks did not amount to a decision by the Federal Open Market Committee, which sets interest rates. The committee’s next policy meeting is scheduled for October 27-28, and Barr did not commit to an increase at that meeting. Barr said U.S.