Chicago Federal Reserve (Fed) President Austan Goolsbee stated that the Fed must have the courage to respond to inflation. He expressed optimism that the Fed could return to its 2% inflation target as long as there are no further signs of demand overheating, explaining that they are still analyzing how much of inflation is due to supply shocks and how much is due to demand. He also emphasized that the argument that the Fed should lower the federal government's borrowing costs is one of the reasons why the Fed's independence is important, adding that if fiscal policy causes inflation, the Fed must certainly consider it.
