Austan Goolsbee, President and CEO of the Federal Reserve Bank of Chicago, speaks at the Capital Hilton during the National Association for Business Economics’ 42nd Annual Economic Policy Conference February 24, 2026 in Washington, DC.
Luke Johnson | Getty Images
Chicago Federal Reserve President Austan Goolsbee called the latest inflation data “borderline worrying.”
“This is another distressing – borderline disturbing – report,” Goolsbee said in an interview with PBS NewsHour on Tuesday.
“We have a real inflation problem that is growing,” Goolsbee said. “We’re going to have to deal with this.”
The consumer price index rose 0.4% on a seasonally adjusted basis in October, according to a statement released Tuesday morning by the Bureau of Labor Statistics. That was higher than economists had predicted, and it was the third straight month of outsized price increases.
Goolsbee said he hasn’t seen pricing factors like tariffs fade over time as he had hoped. He also said he was concerned about continued high service inflation.
And the head of the Chicago Fed said high prices are a major problem for many people he meets.
“It’s on everyone’s mind,” Goolsbee said. “It’s on the minds of businesses. It’s on the minds of nonprofits. It’s on the minds of everyday consumers.”
Tuesday’s inflation report comes at a critical time for Federal Reserve central bankers as they consider their next interest rate move — and what moves they may need to make in the coming months if the numbers keep coming.
Goolsbee’s comments follow remarks by other Fed officials Tuesday, who said the federal Interest Rate Setting Committee may need to act more decisively to curb inflation.
When raising or lowering rates, the Fed typically advances by a quarter of a percentage point. But Fed Governor Christopher Waller said in London on Tuesday that a hot inflation report could push him to argue for an outsized half-point increase in December, and specifically said such a hike should be considered if the core CPI, a measure that strips out the volatile costs of food and energy, was “around 0.3.” A few hours later, that’s exactly what happened.
Dallas Fed President Lorie Logan, speaking Tuesday after the inflation report was released, said she saw the need for two additional quarter-point increases, and said “it may be possible to act more quickly this winter than the FOMC has done so far this fall.”
The rate-setting committee raised rates by a quarter point in September, to a range of 3.75% to 4%, before voting to keep them in place in October.
After years of higher-than-expected price growth, Goolsbee said the possibility that consumers and businesses will begin to expect high inflation is a “major concern.” If that happens, he added, it could make the process of cooling inflation “much more painful.”
But Goolsbee did not say whether he thinks the Fed should raise rates at its December policy meeting because of these concerns.
“I’m not a fan of being super specific and tying our hands at the next meeting or meetings,” Goolsbee said.
Waller, Logan and Paulson are voting members of the FOMC this year, meaning they will vote on whether to raise rates at the committee’s final meeting of the year in December. Goolsbee will be a voting member next year.
In the wake of the inflation report and remarks from various Fed officials, Fed funds futures now unanimously expect a rate hike at the December meeting, according to the CME’s FedWatch tool.
The question now is whether the central bank will raise rates by a quarter or half a percentage point. Fed funds futures currently put the chance of a half-point hike at the next December meeting at 15%.
The chances of rates reaching 4.25% to 4.5% by the January meeting – the equivalent of a half-point hike or two quarter-point hikes – are now 60%, with a 10% chance that rates will reach 4.5% to 4.75% by then.
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