Goolsbee says recent inflation data discouraging, warns against more bad months
The Fed governor says prices and costs are the clearest weak spot in the economy, with contacts more worried about inflation than recession
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Chart: US core CPI, change on the month
UpdateWednesday, October 14, 2026 at 3:29 PM ET
Goolsbee says the broader economy remains solid, with consumer spending, GDP and investment all holding up, and points to energy costs, tariffs and services prices as the main sources of inflation pressure. He says the Fed will bring inflation back to 2% but will not precommit to a policy path before Thursday's producer price data, keeping the approach data-dependent. He also flags a new concern: that enthusiasm around artificial intelligence could drive a further wave of tech investment, adding to the risk of the economy overheating. That keeps him aligned with Fed Governor Lisa Cook and Boston Fed President Susan Collins against the wait-and-see posture of Governor Michelle Bowman and Ric
UpdateWednesday, October 14, 2026 at 3:18 PM ET
The Beige Book finding is now described differently: price growth robust in three districts and intensifying in three more, not moderate in eight of twelve with three quickening as first reported.
Goolsbee singled out services inflation in the CPI report as a particular concern, and said he hopes energy prices soon stop driving the headline number. Richmond Fed President Thomas Barkin said inflation is running higher than he had hoped, though he will not prejudge the Fed's October meeting. Cleveland Fed President Beth Hammack said the Fed needs more policy restraint to hit its 2% goal, citing contacts who describe conditions as strong to booming. Goolsbee's reading now aligns him with Hammack and Boston Fed President Susan Collins, while Barkin and Governor Michelle Bowman are withholding judgment until more data arrives.
Federal Reserve Governor Austan Goolsbee says the latest consumer price data is discouraging and that further months of high inflation would be unacceptable. He called prices and costs clearly the worst part of the economy and said his business contacts are now raising concerns about inflation rather than recession.
Earlier in the day, Goolsbee had said the key question is the trend in inflation, not any single report. He said that if current inflation levels persist, policy would need to respond. The remarks build on comments from October 2, when he warned that inflation progress had stalled and that price pressures were spreading.
Other Fed officials have struck a more cautious tone. Richmond Fed President Tom Barkin has said Thursday's producer price data will help shape his view on inflation. The Fed's Beige Book found price growth moderate in eight of its twelve districts, though three flagged quickening input costs. On Monday, Cleveland Fed President Beth Hammack said inflation pressures are broadening beyond spending on artificial intelligence to other companies and consumers still willing to invest. On Tuesday, Goolsbee said he was now more worried about the combination of trade tariffs and rising oil prices than about inflation on its own, and separately told Semafor that artificial intelligence itself is an inflation problem.
Traders are pricing near 90% odds of a Fed rate increase in December, with additional bets on further hikes through 2027. Citigroup has added a December hike to its own forecast while still expecting rate cuts in 2027. Goolsbee's sharper framing, paired with his reading of business contacts, leaves less room for the wait-and-see posture favored by Barkin and other officials ahead of Thursday's producer price report, and keeps pressure on long-dated Treasury yields and on equities tied to the path of interest rates.