Fed's Hammack says higher rates could be needed as risks of 'inflationary mindset' forming grow

Cleveland Federal Reserve President Beth Hammack said Monday that tighter monetary policy might be needed to bring down inflation and the central bank should make fast, incremental adjustments. "When feasible, I generally think it's preferable to make smaller adjustments, and to do so relatively quickly, rather than to wait and risk needing a larger course correction," Hammack, a voting member of the Fed's policymaking committee, said in prepared remarks delivered during the National Association of Business Economics annual gathering. "Considering all the inputs that factor into my reaction function, a restrictive monetary policy stance is appropriate to ensure a timely return to 2 percent inflation," Hammack added.