Introduction
A top U.S. central banker says the fight against rising prices is not over. Austan Goolsbee is the president of the Chicago Fed. The Fed is the central bank of the United States. It is the bank that sets interest rates for the whole country. Goolsbee spoke to CNBC on Friday. He said the Fed “has definitely got work to do.” He wants people to trust the Fed again on prices.
What Happened
New price data came out this week, and it was not good news. The producer price index rose 0.3% in October. This index tracks the prices that businesses pay. It is a bit like a price tag for the whole economy. Compared with a year ago, it was up 6.5%. That is the biggest yearly jump since November 2022. Consumer prices also rose more than expected. They went up 0.4% in October, while experts had guessed 0.3%. Core prices rose 0.3%. Core prices leave out food and energy, because those prices jump around a lot. Goolsbee said inflation has been above the Fed’s 2% goal for almost six years. He said, “Lately we’re not making any progress, and if anything, it’s going the wrong way.”
Why It Happened
Treasury Secretary Scott Bessent sees it in a different way. He told CNBC the Fed should not raise rates because of an energy shock. He blamed the war with Iran for high oil prices. Goolsbee pushed back on that idea. He said price rises have spread far beyond energy. Services now cost more. Health care now costs more. These are not driven by the price of oil. He also pointed to the building of AI data centres. A data centre is a big building full of computers. Building so many of them adds to demand, and that adds to prices too.
Why It Matters
The Fed’s job is to keep prices steady. Its goal is 2% inflation a year. When prices rise too fast, the Fed can raise interest rates. An interest rate is the price of borrowing money. Higher rates make loans cost more for people and for firms. That can slow spending and cool prices down. The Fed held its main rate at 3.75% to 4% at its last meeting. Markets now fully expect a quarter-point rise at the next meeting on December 8 and 9. A quarter point means 0.25%. Some traders also see a small chance of a bigger half-point rise. Goolsbee is not a voter on the rate committee right now. He becomes a voter in 2027.
What Happens Next
Another Fed voice spoke first. Governor Christopher Waller said on November 10 that he leans toward a quarter-point rise in December. But he set a test. If October core prices came in at 0.3% or higher, he said a half-point rise “should be considered.” The number came in at exactly 0.3%. So his test was met. More price data is still to come before December. The Fed’s favourite price measure, the PCE index, is due soon. The November jobs report is due soon too. Watch what other Fed officials say in the next few weeks. Their words will shape the size of the December move.
Final Thoughts
The message from Goolsbee is plain. Inflation is still too high, and it is not moving the right way. The Fed may need to act in December. The only question now is how big the move will be.
Key Figures
Fed inflation goal: 2% a year. Producer prices, October: up 0.3% in the month, up 6.5% in a year. Consumer prices, October: up 0.4% in the month, more than the 0.3% expected. Core consumer prices, October: up 0.3%. Next Fed rate meeting: December 8 and 9, 2026.
Quick Questions
1) What is the Fed’s inflation target? The Fed wants prices to rise by 2% a year. Inflation has been above that level for almost six years. 2) When does the Fed meet next on interest rates? The next meeting is on December 8 and 9, 2026. Markets fully expect a rate rise then. 3) What did the latest price data show? Producer prices rose 6.5% in a year, the most since November 2022. Consumer prices rose 0.4% in October, more than experts expected.
Disclaimer: This article is for educational and informational purposes only and does not constitute financial advice. Sources: CNBC interview with Austan Goolsbee, November 13, 2026; Reuters report on Treasury Secretary Bessent and Austan Goolsbee, November 13, 2026.
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