Kugler warns rising goods inflation complicates monetary policy

Federal Reserve Governor Adriana Kugler spoke about recent inflation trends at an event in Washington. She noted that while the Fed's interest rate policy is currently restrictive, progress to lower inflation to the 2% target has slowed since last summer. Kugler highlighted an increase in goods inflation, which she described as "unhelpful." Recent data showed that the Personal Consumption Expenditures price index grew at a rate of 2.5% year-over-year in February, the same as in January. She expressed concern over rising inflation expectations among American consumers. Inflation expectations have spiked, partly due to proposed tariff plans from the previous administration. This increase adds pressure on the overall inflation situation. Surveys have indicated that people are worried about rising prices, including the University of Michigan's Consumer Sentiment Index. Despite some signs of slowing economic activity, Kugler stated that the labor market remains stable. As her term on the Fed Board of Governors approaches its end next year, she emphasized the importance of monitoring these inflation trends closely.