Susan M. Collins, President of the Federal Reserve Bank of Boston and not a voting member of the Federal Open Market Committee (FOMC) in 2026 because Boston is not among the four regional banks, told Bloomberg TV she thinks additional policy tightening is warranted soon.

She went further, floating the possibility that the Fed may have to raise rates more than expected, and said the future direction of monetary policy is clear.

On inflation, she was blunt: it is too high and appears to be broadening, and recent data came in “less promising” than she hoped.

Yet she sees no sign of inflation expectations becoming unmoored. Rounding out her remarks, she said the labor market appears to be on solid footing.

Key Quotes:

Monetary Policy

• Would think some additional policy tightening warranted soon

• Possible Fed may have to raise rates more than expected

• Future direction of monetary policy is clear

• Don’t want to say how high or fast rates should move

• Need to decide meeting-by-meeting

• Careful adjustment of policy is ‘appropriate’

Inflation

• Inflation is too high, appears to be broadening

• Recent inflation data ‘less promising’ than I hoped

• Not seeing inflation expectations becoming unmoored

• Concerned about persistence and how quickly inflation will come back down or to what extent it will stay elevated

Labor Market

• Labour market appears on solid footing