Fed Official Signals Potential Stagnation in Inflation Progress

According to Odaily, Federal Reserve official Kugler has indicated that recent data suggests the progress towards the 2% inflation target may have stalled. With economic activity and employment remaining stable, Kugler supports maintaining the current policy interest rate as long as inflationary risks persist. The rise in inflation expectations poses an upward risk to upcoming policy changes. However, it is reassuring that the increase in long-term inflation expectations has been minimal so far. Given the recent high inflation, consumer expectations may be more sensitive to further price increases. Labor market indicators show a continued slowdown, but not a significant weakening.