Chicago Fed President Discusses Inflation and Employment Trade-offs

Austan Goolsbee, president of the Federal Reserve Bank of Chicago, indicated that the Fed may need to increase unemployment to combat high inflation due to ongoing supply shocks. He emphasized that raising interest rates is necessary to align demand with supply, despite the potential for short-term economic pain. His views differ from those of Fed Chairman Kevin Warsh, who believes that labor markets should not be harmed to achieve inflation goals.