Federal Reserve Collins: Current patience with rising inflation is declining, interest rates may need to remain high for longer

On May 13, Federal Reserve Collins said on Wednesday that she expected interest rates to remain stable for a longer period of time and believed that further policy tightening may be needed in some scenarios to ensure inflation returns to the 2% target. She pointed out that traditional monetary policy often "ignores" sudden supply shocks, such as rising oil prices. But considering that inflation has been above the target level for more than five consecutive years, she believes that the current patience to suppress price increases is declining. Collins said the current tight monetary policy "may need to continue for some time." She pointed out: "The shocks have slightly increased the downside risks to economic activity, while the upside risks to inflation have further increased." At the same time, she also said that if inflation falls, the Federal Reserve may still continue to cut interest rates later this year. Collins added, however, if the conflict continues and causes prices to move further upwards,"I can imagine a scenario where policy tightening is needed to ensure that inflation continues to return to 2% within a reasonable time."