Fed's Pianalto says troubled by rise in inflation
Recent news on U.S. inflation has been troubling, but if the economy moderates as forecast, a federal funds rate of 5 percent is near a point that will gradually improve the inflation outlook, a top Federal Reserve official said on Monday.
"The core CPI (consumer price index excluding food and energy) has increased at an annualized rate of more than 3 percent during the past three months. This inflation picture, if sustained, exceeds my comfort level," said Federal Reserve Bank of Cleveland President Sandra Pianalto in a speech at a meeting of the Broadcast Cable Financial Management Association.
On the other hand, she acknowledged the U.S. central bank had already increased borrowing costs some way since it began raising them in 2004, and may have done enough to control prices.
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