Collins Says Fed May Need Rate Hikes to Curb Inflation
Susan Collins says the Fed may need to raise rates if inflation persists. She said that geopolitical conflicts pose risks and expects high prices through 2026.
Boston Federal Reserve President Susan Collins said the United States may need to raise interest rates if inflation pressures do not subside. The central bank currently maintains a benchmark rate between 3.50% and 3.75% following a policy meeting late last month. Collins warned that persistent price pressures and geopolitical risks have reduced her patience for looking through further supply shocks.
### Geopolitical Risks Threaten Inflation Target Collins told the Boston Economic Club on Wednesday afternoon that the U.S.-Israel war with Iran poses a direct threat to the 2% inflation goal. She noted that a prolonged conflict increases the likelihood of negative spillovers that could roil global supply chains. These external pressures add to domestic price levels that have remained above target for more than five years.