Fed's Cook: Time to raise rates in smaller increments

Fed Board of Governors member Lisa Cook said it may soon be time for the Fed to take its foot off the gas in its efforts to reduce high inflation. Fed Board of Governors member Lisa Cook said it may soon be time for the U.S. central bank to take its foot off the gas in its efforts to reduce high inflation. However, Cook also said, “Inflation remains very high and as a result, the Fed should continue to focus on getting inflation back to its 2% target.” Expressing that she is aware that the effects of monetary policy are seen with certain lags, Cook stressed that it is “unclear” at what point the Fed should stop raising interest rates but that it would be prudent to raise rates “in smaller steps.” Cook said, “How far we go with rate hikes and how long we keep rates restrained will depend on the progress made in bringing inflation down.”