Fed's Barr Renews Rate Increase Calls; New York Fed Chief Says Next Hike Can Wait

04:01 PM EDT, 09/29/2026 (MT Newswires) -- Federal Reserve Governor Michael Barr renewed calls for more interest rate increases to curb sticky inflation, and while New York Fed President John Williams also expects monetary policy to get tighter, he sees no urgency to act. High oil prices and a surge in artificial intelligence demand have hindered the process of slowing inflation down to the 2% goal, Barr said in remarks made Tuesday at an event in Detroit. "The combined effect has meant we have been knocked off course on our progress toward our 2% goal," Barr said. "I don't yet see a clear trend toward a timely return to 2%." Earlier this month, the Federal Open Market Committee delivered its first rate hike in just over three years to curb elevated inflation, while signaling that another rate increase could happen later this year. Barr said that "further policy adjustments are likely to be needed to ensure inflation comes down to target in a timely fashion," reiterating what he said last week and echoing recent remarks by some of his Fed colleagues. Three Federal Open Market Committee voters -- Anna Paulson, Beth Hammack and John Williams -- on Thursday signaled the need for a tighter monetary policy amid persistent price pressures. Williams said Tuesday that one more rate hike "may be appropriate late this year to support a timelier return of inflation to target." "I will continue to assess the underlying trends in inflation and the balance of supply and demand in the economy," Williams said in remarks at an event in New York. "With the policy action we took at our September meeting, there is no need for urgency, and we have time to gather more information." Markets are largely split over whether the Fed will lift interest rates again by 25 basis points next month, according to the CME FedWatch tool. Oxford Economics recently said that the next rate increase could come as early as October amid elevated oil prices. Earlier this month, Richmond Fed President Tom Barkin said that inflationary pressures may persist for a while before their impact fades, while Chicago Fed President Austan Goolsbee said that policymakers can no longer afford to look through supply shocks.