Fed’s Collins Says Reaching 2% Inflation Goal May Take Longer

Federal Reserve Bank of Boston President Susan Collins signaled interest rates will likely need to be held at a two-decade high for longer than previously thought to damp demand and reduce price pressures.

Collins, who noted the lack of disinflationary progress made in 2024, said slower economic growth will be necessary to make sure inflation remains on a sustainable path to the Fed’s 2% goal. She didn’t offer an estimate on when rate cuts may happen.

“The recent upward surprises to activity and inflation suggest the likely need to keep policy at its current level until we have greater confidence ...