She said excess inflation is unacceptable. Her remarks come after higher-than-expected CPI data pushed markets to price in roughly one more hike over the next 12 months.
Inflation and the policy stance
Logan said accommodative policy is adding to inflationary pressures. She said that after two more hikes it would make sense to pause and assess. The current federal funds target range is 3.75 to 4.00 percent, and Logan put the policy rate about 50 basis points below a modestly restrictive level. She cited a real Fed funds rate of 78 basis points.
Logan said it may be possible to raise rates more rapidly this winter than the Fed has moved so far. She also said wartime energy disruptions are not the only source of price pressures. Inflation is trending meaningfully above the Fed’s 2 percent goal, she said.
Labor market and markets
Logan described the labor market as balanced and said it is even tightening a bit. She called economic growth strong. The two-year Treasury yield rose 20 basis points on the day to 4.75 percent.
Markets are pricing the Fed’s rate peak for the second half of 2027.
Related: Waller says Fed must follow through on rate hikes · BoJ minutes show members split on pace of rate hikes
Data: FRED — St. Louis Fed
