Federal Reserve governor Michael Barr said Tuesday that if inflation doesn't come down adequately, the central bank should raise interest rates.
Ahead of the Fed policy meeting in just over two weeks, Barr said the outlook for inflation and the economy will top the agenda.
"If trends in the data give me some confidence that inflation is moderating on a path to 2%, then I think we can take a bit more time to ***** s our policy stance," Barr said, according to prepared remarks. "However, if inflation appears not to be moderating sufficiently, then I think we should act decisively to raise rates."
The Fed will get two more readings on consumer and wholesale inflation next week before the meeting on Sept. 16. Recent inflation data has been mixed, with back-to-back cooler reports on the Consumer Price Index for June and July and one stickier report on the Fed's preferred inflation gauge, the Personal Consumption Expenditures index.
Still, Barr said inflation remains too high, pointing to a series of shocks — from tariffs to the conflict in the Middle East to the rapid AI build-out — that "pushed us off course."

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