Beth Hammack, president and chief executive officer of the Federal Reserve Bank of Cleveland, during a research conference at the Federal Reserve Bank of Dallas in Dallas, Texas, US, on Friday, Oct. 31, 2025. <\/p>\n
Desiree Rios | Bloomberg | Getty Images<\/p>\n
Federal Reserve officials who voted this week against the decision to hold interest rates steady said Friday they favor hiking now as a way to stave off inflation.<\/p>\n
“In my view, now is the time for the [Federal Open Market Committee] to act to speed the return of PCE inflation to our 2 percent objective and deliver on our commitment to price stability for the American people,” Cleveland Fed President Beth Hammack said in a statement. “The longer that high inflation persists, the more challenging and costly it can be to bring it back down.”<\/p>\n
Similarly, Minneapolis Fed President Neel Kashkari said he believes small hikes now can prevent the need for larger moves later.<\/p>\n
“In my view, a potential series of small policy moves would be better than waiting and eventually concluding that even bolder actions were necessary,” he said.<\/p>\n
Kashkari and Hammack joined Dallas Fed President Lorie Logan in dissenting against holding the Fed’s key overnight borrowing rate in a range between 3.5%-3.75%. The other nine voting members of the FOMC voted in favor of keeping the rate steady, where it has been all year following a series of three cuts in the latter part of 2025.<\/p>\n
Inflation has held above the Fed’s 2% target for more than five years, spiking again this war following the Iran war and the impact of President Donald Trump’s tariffs.<\/p>\n
Though price increases eased in June as Middle East tensions briefly eased, energy costs again have risen and generated fears that the Fed will have to tighten.<\/p>\n
Though he voted in favor of the hold, Fed Chairman Kevin Warsh said he remains resolute in getting inflation back to target.<\/p>\n
“We have begun a new chapter, and we understand that the five-plus years of inflation above target cannot be cured in nine weeks \u2014 or by a single month of modest price decreases,” he said.<\/p>\n
However, Hammack said she is “not confident it will return to our objective on its own.”<\/p>\n
“Supply-side factors, including energy prices, have boosted inflation this year, but I see inflationary pressures coming from the demand side of the economy, as well,” she added.<\/p>\n
Hammack said her constituents in the Cleveland area have been describing “pricing pressures as broadening rather than fading, and consumers are expressing despair over persistently higher prices.”<\/p>\n
For his part, Kashkari’s comments harken back to both the 1970s period of high inflation and the more recent episodes in which Fed officials initially dismissed the flare-up as “transitory” and brought on up issues related to the Covid pandemic.<\/p>\n
“Economic theory argues that monetary policy is the right tool to address demand-driven inflation but faces greater trade-offs when dealing with supply shocks,” he said, adding, “I increasingly believe that monetary policy does have an important role to play in addressing a series of successive supply shocks that might lead to entrenched higher inflation.”<\/p>\n
Logan is expected to release a statement explaining her vote later Friday morning.<\/p>\n