The Strategist

Fed warns of stronger US inflation due to rising fuel prices

11/29/2023 - 08:06

The Fed has issued a warning about increased US inflation as a result of growing fuel costs.

Tony Webster
Tony Webster
A potential increase in energy costs in the upcoming months may partially counteract the gains achieved in the fight against inflation in the US, according to Michelle Bowman, a member of the Federal Reserve System's Board of Governors.

Speaking to the business community in Utah, Bowman cautioned, "There is also a risk that higher energy prices in the months ahead could partially undo the recent progress that has been made with supply-side improvements to reduce overall inflation."

The Fed is raising rates in an effort to slow down economic growth and return inflation, which has accelerated to 40-year highs, to 2 percent annually.