Fed’s Goolsbee Says Path to 2% ‘Unlikely to Be Painless’

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Austan Goolsbee, President of the Federal Reserve Bank of Chicago, stated that achieving a 2% inflation target will likely involve painful trade-offs, including economic hardship. Speaking in London, he warned of persistent supply shocks and the tough decisions the central bank must face.

Federal Reserve Bank of Chicago President Austan Goolsbee warns that the central bank cannot ignore repeated and persistent supply shocks and must respond in a way that may cause economic hardship. Goolsbee calls it “exactly the kind of painful trade-off between employment and inflation that stagflationary shocks always impose on the central bank.” He spoke Monday in London. (Source: Bloomberg)