Fed Governor Cook Signals Readiness for Rate Hike Amid Persistent Inflation Concerns
| Pair | Now | Since publish |
|---|---|---|
| EURUSD | — | — |
| GBPUSD | — | — |
| USDJPY | — | — |
- Cook supported holding rates, but is “prepared to act” on inflation.
- Fed’s Cook: Inflation risks > jobs; awaits disinflation signs.
- Cook notes inflation high for five years, aligns with Kevin Warsh.
Federal Reserve Governor Lisa Cook recently stated her readiness to raise interest rates should inflation fail to decelerate. Speaking on Wednesday, Cook emphasized that inflation remains “too high,” viewing the risks to the inflation side of the dual mandate as greater than those to employment. She warned that policymakers might not have the luxury of waiting for inflation to return to the 2% target. These remarks contribute to a growing hawkish sentiment among some Fed officials, particularly following the recent split decision to hold rates steady, which included three dissenting votes favoring a hike. Markets are now expected to price in higher probabilities of a rate increase at upcoming meetings, especially if future inflation data disappoints, potentially impacting the US Dollar and short-term yields.
Fed Governor Lisa Cook stated she supported holding rates unchanged at the last Federal Open Market Committee (FOMC) meeting, indicating she is awaiting more data. She reiterated her commitment to price stability, emphasizing that inflation risks outweigh job market risks. Cook warned that she is “prepared to act” with a rate hike if “signs of continued disinflation” are not observed soon, adding that the longer inflation remains above the central bank’s goal, the tougher it will be to rein it in. These remarks were made during a speech at an event in Alaska, where she also noted that inflation has been persistently high for five years. Her stance aligns with new Fed Chair, Kevin Warsh.