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A Timely Journey Back to Price Stability: Are We There Yet? No. Will We Get There? Yes

Author

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  • Loretta J. Mester

Abstract

In summary, the economy is on a good path. Demand is moderating and supply conditions are improving. Labor market conditions remain strong, but the imbalance between labor demand and supply is narrowing and firms are finding it easier to find the workers they need. Progress is being made on inflation, but the level of inflation remains too high. We are likely near or possibly at the peak of the fed funds tightening cycle. Now our task turns to ensuring that we keep monetary policy restrictive for long enough to be confident that inflation returns to our 2 percent goal in a timely way. We are not there yet, but we will get there because price stability is critical for the long-run health of the labor market, the overall economy, and the stability of the financial system.

Suggested Citation

  • Loretta J. Mester, 2023. "A Timely Journey Back to Price Stability: Are We There Yet? No. Will We Get There? Yes," Speech 97001, Federal Reserve Bank of Cleveland.
    • Handle: RePEc:fip:fedcsp:97001
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