Even the Fed's 'doves' have turned hawkish... Cook says, "We will raise rates if necessary"

[Financial News] Within the U.S. Federal Reserve, a series of remarks have pointed to the possibility of additional rate hikes. Lisa Cook, a Fed governor who voted to keep rates unchanged last month, said she is "prepared to support rate increases if necessary," underscoring a stronger hawkish tone inside the central bank.
In a public speech in Anchorage, Alaska, on the 5th local time, Cook said inflation remains "far too high." She added that, among the Fed's dual mandate, she sees greater risk on the price-stability side than on employment.
She said she would carefully consider the impact of higher rates on the labor market and economic growth, but added, "If needed to bring inflation down, I will support a rate hike."
At last month's Federal Open Market Committee (FOMC) meeting, Cook sided with the majority in voting to hold the benchmark rate at 3.5% to 3.75% a year. Her remarks on this day, however, were interpreted as leaving open the possibility that she could shift toward supporting a hike at future meetings if price pressures persist.
She cited several factors that could shape the inflation outlook, including whether tariff effects ease, energy supply shocks from the Iran war, and stronger demand from expanded investment in Artificial Intelligence (AI) infrastructure.
She suggested that if the price pressures driven by those factors gradually fade, inflation could stabilize. But if they last longer than expected, additional tightening may be needed.
Neel Kashkari, president of the Federal Reserve Bank of Minneapolis and another prominent hawk within the Fed, also reiterated the need for higher rates on the same day.
In an interview with CNBC, Kashkari said, "This is the right time to raise rates slowly." He added, "Corporate earnings are solid, consumer spending and the labor market are both strong, and it is hard to find evidence that current monetary policy is sufficiently restrictive."
At last week's FOMC meeting, he joined Beth Hammack, president of the Federal Reserve Bank of Cleveland, and Lorie K. Logan, president of the Federal Reserve Bank of Dallas, in calling for a rate hike and voting against holding the benchmark rate steady.
Market watchers say that with even Cook, who had previously backed a pause, now mentioning the possibility of a hike, discussions over further tightening at upcoming FOMC meetings could gain more momentum.

[email protected] Kim Kyung-min Reporter