San Francisco Fed President Daly said she fully supports last week’s decision to leave rates unchanged. With inflation clearly above the 2% target, she said the Fed needs more data before the September meeting to judge whether recent inflation reflects fading supply shocks or is becoming more persistent. Daly said the Fed should closely monitor incoming information and be prepared to act if necessary. She expressed concern about public inflation expectations and warned that if inflation momentum

San Francisco Fed President Daly said she fully supports last week’s decision to leave rates unchanged. With inflation clearly above the 2% target, she said the Fed needs more data before the September meeting to judge whether recent inflation reflects fading supply shocks or is becoming more persistent. Daly said the Fed should closely monitor incoming information and be prepared to act if necessary. She expressed concern about public inflation expectations and warned that if inflation momentum picks up the Fed may need to take forceful steps to return price pressures to target. Daly is not currently an FOMC voter.