Federal Reserve Governor Bill Waller on Tuesday reiterated the Fed's determination to bring inflation down to its 2 percent target, but did not comment on the economic outlook or his view of the best course for monetary policy at the moment.
"Price stability is the Federal Reserve's primary responsibility," Mr Waller said in a speech to a conference at the Mercatus Centre at George Mason University in Virginia. "That is why we have taken strong action aimed at reducing inflation and why we will continue to work to achieve our objective."
In addition, Waller said, "In considering the appropriate monetary policy response to bring inflation back to 2 percent, I think it would be useful to draw on the findings of the policy rule literature." These findings include the 'Taylor principle' that the federal funds rate should respond more than one-to-one when inflation deviates from the target - helping to ensure that real interest rates are raised when policy is tightened."
Waller has been a strong advocate for the Fed's rate hikes, which have pushed the short-term policy rate to its current range of 5.25% to 5.50%. That's above the 3% average increase in the core PCE price index over the last six months.
But the US economy has proved surprisingly resilient in the face of aggressive rate hikes by the Fed. The labor market is still strong, and as supply channels normalize, inflation is starting to cool, more workers are returning to the labor force, and productivity has improved.
Waller's strong reaffirmation of the 2 percent inflation target also pointed to another of the Fed's mandates - full employment - and said its measure could change over time.
But in contrast to Waller's strong tone, a number of officials have recently made more conciliatory remarks. In recent days, three Fed officials have cited the rout in credit markets and said it could temporarily halt the need for further tightening.
Fed Vice Chairman Thomas Jefferson said at a conference on Monday that he would "continue to recognize the tightening of financial conditions resulting from higher bond yields" in assessing the "future path of policy." That echoed similar comments from other policymakers in recent days.
At the same time, Bostic, who has been the face of the Fed's dovish wing, continued to argue for a halt to rate hikes, saying that current policy is sufficiently restrictive and that "many" effects of the Fed's rate hikes have yet to be felt.
As of now, futures markets are pricing in less than a 20 percent chance of another 25 basis point rate hike when the Federal Open Market Committee meets Oct. 31-Nov. 1.