Goolsbee: Inflation Staying Too High A Bigger Risk

Highlights from Chicago Fed’s Goolsbee (’23 voter) appearing on CNBC, who so far hasn't repeated previous mention of the "good news" on inflation but rather with risks skewed to the upside.

• Risk of inflation staying too high a bigger risk. Debate will soon shift to how long to hold rates high.
• It "feels like" rates will have to stay higher for longer than markets had expected and Fed will have to "play by ear" whether rates need to move higher. Concern over inverted yield curve doesn't account for possible differences in the post-pandemic recovery.
• We’ve got to get inflation back to 2% - we’re doing it.
• Can’t change inflation target until the target is reached – it defeats the purpose of having a target if Fed were to undermine it and “give up”.
• The current path is “unusual” for inflation to fall like it is without unemployment rising. Soft landing possible but still lots of risks.