Michelle Bowman, Speech: Fighting Inflation in Challenging Times

“Many of the underlying causes of excessive inflation are the same as they have been over the past year or so—supply chain issues, including those related to China’s COVID containment policies, constrained housing supply, the ongoing conflict in Ukraine, fiscal stimulus, and limitations on domestic energy production.”

“Regardless of the source of the inflationary pressure, the Federal Reserve has a duty to bring inflation down to our 2 percent target. This duty is mandated by Congress to carry out monetary policy that results in price stability—meaning low and stable inflation.’

“One aspect of the job market that has not recovered is labor force participation. Based on the pre-pandemic trend, there are nearly four million people who are still sitting out of a strong labor market.”

“Based on current economic conditions and the outlook I just described, I supported the FOMC’s decision last week to raise the federal funds rate another 75 basis points. I also support the Committee’s view that “ongoing increases” would be appropriate at coming meetings. My view is that similarly-sized increases should be on the table until we see inflation declining in a consistent, meaningful, and lasting way.”