Fed official warns inflation is still too high

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[sailthru_widget name="Sailthru Widget Block" sailthru_list="Business and Economy" title="Business & Economy"] Welcome to The Hill's Business & Economy newsletter{beacon} Business & Economy Business & Economy The Big Story Fed official: Inflation still too high in 'all aspects' of economy Neel Kashkari, the president of the Federal Reserve’s Minneapolis branch, said Sunday that inflation is “still too high,” days after the central bank raised interest rates. © Photo by Evan Agostini/Invision/AP“Even if we strip out energy, which is really volatile, and strip out food, they matter a lot, but in terms of where the economy is going, inflation is still too high,” Kashkari told host Jackie DeAngelis on Fox News’s “Sunday Morning Futures.” He later said, “The inflation that the American people are feeling every day is much beyond just oil prices. It’s in all aspects of the economy.” Annual inflation in August was 3.4 percent, as measured by the consumer price index (CPI). Core inflation, which excludes volatile food and energy prices, was 2.4 percent last month, per the CPI. Inflation has remained above the Fed’s 2 percent target rate since March 2021, reaching a 40-year high of 9.1 percent in June 2022. Persistent inflation spurred the 12-member Federal Open Market Committee (FOMC) to raise its baseline interest rate target by a quarter point last week, to a range of 3.75 percent to 4 percent. The FOMC had not hiked rates since July 2023 and cut rates at its final three meetings of last year. After the unanimous vote, Fed Chair Kevin Warsh said the rate hike “will support a timelier return” to the central bank’s 2 percent target. “I would be hard-pressed to describe broad financial conditions as restrictive,” Warsh told reporters. “This view was widely shared by the committee, so we removed a dose of accommodation.” The Hill's Max Rego has more here. Welcome to The Hill’s Business & Economy newsletter, I'm Julia Shapero — bringing you the latest on the intersection of Wall Street and Pennsylvania Avenue. Did someone forward you this newsletter? Subscribe here. Essential Reads Key business and economic news with implications this week and beyond: Bessent says he has ‘great confidence’ in Warsh after Fed raises rates Treasury Secretary Scott Bessent said Monday he has “great confidence” in Federal Reserve Chair Kevin Warsh after the central bank raised interest rates by a quarter point against the wishes of President Trump. Full Story Bessent says US, Chinese officials considering lowering tariffs on ‘noncritical’ items Treasury Secretary Scott Bessent said Monday officials from the U.S. and China are considering lowering tariffs on “noncritical” products, as President Trump prepares to host Chinese President Xi Jinping this week in Washington, D.C. Full Story Payment size revealed in massive Oracle settlement: Here’s how much you’ll get Payments are set to be issued starting Monday in the $115 million class action lawsuit against tech company Oracle that “millions” could have qualified for. Full Story Both parties embrace Supreme Court spending limit ruling in midterm home stretch Both parties are embracing the Supreme Court’s summer ruling that allows parties to coordinate and spend unlimited amounts of money with campaigns as marquee midterm races head into the home stretch. Full Story In Other News Branch out with more stories from the day: Barrasso says ‘we need to do more’ on affordability as midterms near Senate Majority Whip John Barrasso (R-Wyo.) said Sunday that the GOP needs to “do more” to lower costs for Americans with the midterms roughly six weeks away. Full Story Good to Know Business and economic news we've flagged from other outlets: Nasdaq notches record-high close, AI optimism reignites and Treasury yields retreat (Reuters) AMD hits $1 trillion market cap for the first time as stock rides 5-day rally (CNBC) What Others are Reading Top stories on The Hill right now: Trump move to ban news outlets blows up at White House President Trump’s abrupt move to withdraw White House press credentials for three news organizations triggered a rare moment of unity among television networks, with several news media outlets announcing Monday they would not cover the president’s daily activities while the ban on the trio remains … Read more Belarus says no potash left after Trump claims massive deal for fertilizer Belarus’s authoritarian leader Alexander Lukashenko said Monday that there are no available volumes of fertilizer to send to the U.S. This came after President Trump announced that he was working on a “massive Deal” to buy potash from Minsk at a steep discount amid the trade war with Canada. Read more What People Think Opinions related to business and economic issues submitted to The Hill: The only solution to our $40 trillion debt problem is a value-added tax You're all caught up. See you tomorrow!

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