Fed's Goolsbee: Inflation has extended beyond energy, and the Fed is not yet on the path back to 2%

November 13 - Chicago Fed President Goolsbee said in a CNBC interview on Friday that even with the rapid decline in oil prices, refining capacity remains "problematic," which will keep diesel and jet fuel prices elevated. He stated that inflation is currently spreading to categories where prices are not driven by rising energy costs, and if demand overheats, the Fed cannot turn a blind eye to inflation. Goolsbee believes data centers are pushing up prices, while services inflation and rising healthcare costs feel absolutely unlikely to fall quickly in the short term.

Goolsbee added that the Fed is currently not on track to achieve its 2% inflation target, and the central bank needs to address this issue to ensure demand does not overheat; if data shows inflation is worsening, this would prompt the Fed to take more aggressive action on policy.