Exclusive | Fed’s Barkin Says It’s a ‘Close Call’ Whether Rates Are High Enough

Richmond Fed President Tom Barkin said the central bank faces a "close call" on whether interest rates are high enough to bring inflation down, signaling uncertainty within the Fed even as the majority holds rates steady. Barkin, who does not vote on policy this year, told the Wall Street Journal he couldn't say whether he would have joined the three colleagues who dissented in favor of a rate increase at the most recent meeting.

The comments highlight ongoing debate inside the Federal Reserve over the terminal rate level. Three officials broke ranks to favor higher rates, marking one of the more divided votes in recent policy meetings. Barkin's ambivalence suggests the hawkish camp may have broader support than the formal vote tally indicates.

The Richmond Fed president's remarks come as markets parse every signal from regional Fed officials for clues on the duration of the current restrictive stance. His acknowledgment that the decision is a "close call" underscores that the Fed has not reached consensus on whether current policy will be sufficient to return inflation to the 2% target.