Fed’s Goolsbee: Hopes Dangerous Inflation Data Is Only Temporary

　　Xinhua Finance, Beijing, August 22 – Chicago Fed President Austan Goolsbee stated that although recent inflation data showed some signs of moderation, an unexpected surge in service sector prices constitutes a "dangerous signal." He hopes this phenomenon is only temporary and not a precursor to a rebound in inflation.

　　"The latest inflation report showed that service sector inflation indeed began to surge, with a month-on-month increase of 1.1%, the largest rise since March 2022," Goolsbee said in a speech ahead of the Jackson Hole Global Central Bank Annual Meeting. "Although it is still uncertain whether this increase was directly driven by tariffs or other external factors, it is a dangerous data point. I hope this is just a one-off episode rather than a reversal of the trend."

　　As a rotating voting member of the Federal Open Market Committee (FOMC) in 2025, Goolsbee emphasized that the Fed still needs to cautiously assess more data before its September policy meeting. "In my view, the September meeting is like a live meeting," he said. "We cannot make judgments based solely on one report. We need to confirm whether inflation is truly returning to a downward path."

　　Recently released U.S. July Producer Price Index (PPI) rose 0.9% month-on-month, far exceeding expectations, with service costs being the main driver. Meanwhile, the University of Michigan Consumer Sentiment Survey showed that both short-term and long-term inflation expectations have rebounded, heightening market concerns about inflation stickiness.