Richmond Fed's Barkin Says Last Week's Rate Hike May Not Be Enough to Curb Inflation

Richmond Federal Reserve President Thomas Barkin warned on September 22 that the Fed's rate hike from the prior week may not be sufficient to bring inflation under control, and that additional increases could follow. Speaking in a public address, Barkin described inflation as a persistent "problem child," cautioning that temporary shocks fueling price pressures this year could prove longer-lasting and that new cost pressures could yet develop.

Barkin said the Fed hiked last week because risks to inflation outweigh risks to maximum employment, and he stressed that the central bank is highly attentive to financial conditions but cannot assume that markets alone will keep rates high enough to cool prices. The Fed voted 12-0 at its September meeting to raise its benchmark rate by 25 basis points, lifting it to a range of 3.75% to 4%, the first such increase in more than three years.

Barkin's remarks reinforced a hawkish posture as the Fed's preferred inflation gauge, the PCE price index, stood at 3.7% year-over-year in July 2026, with core PCE at 3.3%, the highest since 2023. He acknowledged the US economy is firming but said that improvement does not diminish the inflation threat, and that entrenched price pressures remain a central concern for policymakers going forward.