Fed forecasts inflation will remain high through 2026

Federal Reserve Governor Lisa Cook has warned that inflation could remain high into 2026 due to the impact of tariffs, while pledging to complete the task despite President Donald Trump's attempts to fire her.

Consumers choose to buy goods at a supermarket in California, USA. Photo: THX/TTXVN

Speaking at the Brookings Institution in Washington, Ms. Cook said that through discussions with business leaders, she found that the impact of tariffs on consumer prices had not been fully reflected.

Many businesses are selling off inventory at low prices before consumer prices rise, she said, while others are waiting for the tariff situation to stabilize before adjusting prices. She forecast inflation would remain high next year, but said she was “ready to act decisively” if the impact of tariffs was stronger or lasted longer than expected.

In a statement on November 3, Ms. Cook said that while the impact of tariffs on costs is temporary, and inflation may continue to cool afterward, the risk of a lasting impact remains. She also predicted that the government shutdown will slow economic growth this quarter and could affect the private sector. However, she said these impacts will be "mostly temporary."

The Fed aims to maintain inflation at 2% over the long term. Currently, Fed officials are still weighing the risk of rising inflation against the serious weakness in the labor market. The Fed's next policy meeting is scheduled for December 9-10.

Source: https://hanoimoi.vn/fed-du-bao-lam-phat-se-duy-tri-o-muc-cao-trong-nam-2026-722091.html