Lorie Logan, Speech/Q&A: Fed Listens Event hosted by The Federal Reserve Bank of Dallas

Q&A Segment –

Inflation & Jobs

“Well, I’ve had the great pleasure of traveling across the district over the last nine months and held a number of sessions like these. And I think, Alfreda, I would say that they’re definitely common themes in all of those discussions.”

“The first one of course is on everyone’s mind and a high priority for us as policy makers, is inflation. Inflation is too high and far above our target.”

“And we heard a lot about that today, which is the labor markets more generally and just how tight they are. And that tightness in the labor market is contributing to the inflation dynamics. And so until we see some change in those underlying dynamics, those inflationary pressures will remain a concern.”

“And I think another topic that’s part of that discussion, of course, is immigration and what the appropriate policies can be to really foster a labor market that’s really going to be healthy and serve our businesses and our community.”

Speech Segment –

Fed Funds, Inflation & Jobs

“I’ll also be listening closely to your perspectives on the economy. As you surely know, inflation has been much too high. The Fed has raised interest rates by 4.5 percentage points over the past year to bring the economy into better balance.”

“To assess whether we have made enough progress, I’ve been watching three markers:

• Whether there is further and sustained improvement in the inflation statistics.
• Whether the economy is evolving more or less as forecasts predict.
• Whether there is a clear change in the underlying factors—like the imbalance of supply and demand and the resulting very tight labor market—that have produced high inflation.”

“Over the past six weeks, I’ve also been closely watching the effects of stresses in the banking system—both on the macroeconomy and on local communities, especially here in Texas where small and midsize banks are so important. Smaller banks are particularly significant in small business, rural, middle-market, and commercial real estate lending. And to have a strong economy, we need a diverse, vibrant banking ecosystem.”