Chicago Fed President: Further Rate Cuts Loom If Inflation Progresses Toward 2% Target

Chicago Fed President Austan Goolsbee indicated further Federal Reserve interest rate cuts are possible if inflation continues to trend toward the 2% target, emphasizing the need for additional inflation improvement and a stable labor market. The January CPI showed a 2.4% year-over-year price increase, with core prices up 2.5%. Goods prices, including tariff impacts, appear under control, but services inflation remains high and persistent, with Goolsbee suggesting it may be transitory. He noted the Fed has room to cut rates further before reaching a neutral level. As of February 13, 2026, CME data shows a 90% probability the Fed will hold rates at its March 18 meeting.