Federal Reserve official warns of risk of inflation spike in 2025
Thomas Barkin, president of the Richmond Federal Reserve, warned in a speech to the Maryland Bankers Association in Baltimore that the risk of rising inflation in 2025 is greater than investors think.
According to Reuters, Barkin said that given the possibility of rising wages and other price pressures, the risk of rising inflation is greater than the risk of falling it.

He added: "I am among those who prefer to maintain restrictive policies for a longer period, contrary to another view that believes that the work is over and rates should be reduced to neutral levels."

The federal funds rate (FFR) is currently 4.33%, having reached this level after consecutive cuts by the Federal Open Market Committee (FOMC) since September 2024.
Barkin also predicted that economic growth will be greater than contraction, but inflation risks remain. He also said that the labor market is more likely to move toward hiring than layoffs.