Fed’s Paulson: Further Gradual Rate Hikes Are Appropriate, Fed Will Move More Aggressively If Inflation Outlook Worsens

Policy Needs To Be Somewhat Restrictive, With The Rate Path Depending On How The Economy Evolves - Supports Recent Fed Decisions, Saying Gradual Hikes Give The Economy Time To Adjust And Officials Time To Gauge Their Impact - CPI Data Show Inflation Remains A Problem, With Underlying Inflation Stuck Between 2.5% And 3% - Inflation Risks Are High And The Fed Has More Work To Do, While The Impact Of AI And Energy On Inflation Is Hard To Gauge - Economy Is Stronger Than Expected And The Job Market Is Robust And Stable