Fed’s Barkin Believes Inflation Surge is Temporary

Inflationary pressures in the United States are temporary but monetary policymakers must be careful in closely monitoring consumer prices, the President of the Federal Reserve Bank of Richmond, Thomas Barkin, said on Thursday.

“I do believe we are in the middle of a temporary adjustment cycle during which workers will return to the workplace and schools open and fiscal payments expire and suppliers catch up with demand.”

“For those reasons, I expect our near-term inflation pressure to ease as we go into the fourth quarter.”

“Daily car rental prices are not going to be $400 forever, because more supply is going to come online.”

“A great cure for high prices is well, high prices.”

“I think the last 30 years of relative price stability has got to outweigh a few months of pressure, but one can never be too careful.”

“That is why the Fed has started the process of discussing normalization.”