[Fed's Goolsby: Rate Cuts May Not Be Completed Until 2027] Chicago Federal Reserve President John Goolsby said on Tuesday that if the Iran war leads to persistently high oil prices, slowing the decline of inflation towards the Fed's 2% target, the Fed may not cut interest rates until 2027. Speaking at the Semafor World Economic Conference, Goolsby said, "I originally thought there might even be multiple rate cuts in 2026; but if this continues, and we don't see inflation decline, and inflation remains high, realistically, this will push the timeline back beyond 2026. Our responsibility is to bring inflation back to 2%." Goolsby was once a relatively optimistic member of the Fed, believing that tariff-driven inflation would decline this year, allowing the Fed to resume rate cuts. However, his confidence has now waned. He said, "In some cases, interest rates may rise; in other cases, it all proves to be temporary—the Middle East oil price shock is resolved, inflation declines again, and it looks like we are returning to the 2% target, then rate cuts will also be back on the agenda."
