Federal Reserve's Collins Supports Rate Hike to Drive Inflation Back to 2% Target

Boston Fed President Collins supports the Federal Reserve's decision to raise interest rates last week, believing that this move will help bring inflation back to the central bank's target level of 2%. She stated that a moderate increase in the federal funds rate will assist in ensuring that inflation sustainably returns to the target, especially after experiencing high inflation for five and a half years. Collins noted that as labor market conditions improve, monetary policy should focus on timely restoring price stability. Although she does not have a vote in this year's monetary policy decisions, she mentioned that the likelihood of inflation remaining significantly above 2% has increased.