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Fed Official Emphasizes Public Hatred of Inflation Over Bank Stress and Job Loss

Fed official Tom Barkin highlights the public's aversion to inflation, leading to the ninth consecutive interest rate hike despite concerns over bank stress and potential job losses.

Thomas Barkin, Federal Reserve Bank of Richmond President
Thomas Barkin, Federal Reserve Bank of Richmond President

Inflation Remains a Major Concern for Public

In a recent exclusive interview with CNN, Tom Barkin, the president of the Federal Reserve Bank of Richmond, expressed that inflation continues to be the public's primary concern. According to Barkin, raising interest rates was straightforward as inflation remains high and demand has not decreased.

Fed Raises Interest Rates for Ninth Consecutive Meeting

Barkin, who participates in the Fed's debate but does not have a vote this year, acknowledged that every decision is difficult and thoroughly discussed. However, economic reports leading up to the latest Fed meeting indicated that the economy remains overheated. As a result, the Fed unanimously decided to raise interest rates for the ninth consecutive meeting.

Opposition to Interest Rate Increase Amid Bank Failures

Some experts, such as former FDIC Chair Sheila Bair and Moody's Analytics Chief Economist Mark Zandi, advised against raising interest rates to avoid worsening turmoil in the banking system following the failures of Silicon Valley Bank and Signature Bank. Barkin, however, felt that the banking system was stable enough to proceed with the monetary policy as planned.

Criticism of Rapid Rate Increases and Potential Job Losses

Politicians from both sides of the spectrum have criticized the Fed for raising rates so quickly, arguing that it could lead to mass layoffs.