Washington, May 4 (SANA) U.S. Federal Reserve officials warned that a prolonged conflict involving the United States, Israel and Iran could push inflation higher and complicate interest rate decisions.
Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, said the war could increase economic damage and make it harder for the central bank to set a clear policy path.
Speaking to CBS TV on Sunday, Kashkari said the focus is on the impact of the conflict on inflation and economic demand, particularly with the continued disruption of the Strait of Hormuz, a key route for global energy supplies.
He said energy and fertilizer prices are likely to rise as long as the conflict continues, adding that the Federal Reserve may be forced to raise interest rates in response.
Separately, Chicago Federal Reserve President Austin Goolsbee said the latest U.S. inflation data was “bad news,” pointing to the personal consumption expenditures (PCE) price index, which rose 3.5 percent year-on-year through March, remaining above the Fed’s 2 percent target.
R.A/ABD
