Fed’s Logan Sees At Least Two More Quarter-Point Hikes, Backs Gradual Pace

• Logan sees at least two more 25 bp Fed hikes
• Skipping a meeting doesn’t change the policy destination
• Inflation not returning to 2% called “unacceptable”
• Gradual pace seen reducing risk of sharp economic deterioration

Dallas Fed President Lorie Logan said she still sees the need for at least two more quarter-point rate hikes, while arguing the central bank can move gradually. She said skipping a meeting does not change the policy destination, and that a measured approach lowers the risk of sharp economic deterioration. Gradual adjustment, she added, helps households, businesses and investors adapt to higher rates. Logan described the end goal as making policy modestly restrictive, and said that making the destination clear would help the economy adapt and capture the benefits of a skip. She called it “unacceptable” that inflation is not heading back to the Fed’s 2% target. After 50 bps of hikes, she said, a pause would make sense to assess the path going forward. The remarks reinforce a bias toward further tightening, delivered at a gradual pace.