Cleveland Fed’s Beth Hammack Advocates for Maintaining ‘Barely Restrictive’ Interest Rates Amid Inflation Concerns
Cleveland Fed’s Beth Hammack Advocates Keeping Interest Rates at ‘Barely Restrictive’ Levels
November 20, 2025 — Cleveland Federal Reserve President Beth Hammack spoke on Thursday. She signaled that the cycle of rate cuts might soon end. In her CNBC Squawk on the Street interview, she pointed to a need for a small extra pull on policy. Her words tie the idea of a tighter stance to meeting the Fed’s inflation target.
Current Monetary Policy: “Barely Restrictive, If at All”
Hammack labels current monetary policy as “barely restrictive, if at all.” She makes clear that the bank must keep policy tight enough. Her words join the idea of slow inflation growth with the aim of reaching 2%.
“Right now, to me, monetary policy is barely restrictive, if at all, and I think we need to make sure that we’re maintaining that somewhat restrictive stance,” Hammack told CNBC’s Steve Liesman.
Interest Rate Levels and Economic Impact
Hammack ties the federal funds rate of 3.75% to 4% to what is seen as a neutral position. This rate and its closeness join to a view that extra cuts do not help now.
Her remarks come as market views change. The FOMC meets next on December 9-10. The market, which had tied a third rate cut to the cycle, now shows a 60% chance that rates will stay the same. This view comes from CME Group’s FedWatch tool.
Divergent Views Within the Fed
Minutes from the October Fed meeting show splits among members. Those minutes join views that balance inflation risks with soft spots in the labor market.
Hammack, who usually shows a strong view on inflation, favors higher rates. Her stance keeps a tight grip on price rises. Still, she shows care for workers in her region.
Insights from the Cleveland Region: Inflation’s Impact on Workers
Hammack shares chats with local workers and business owners. She ties low hiring and low firing rates to a soft labor market. Yet, she links real pain to inflation cutting the buying power of wages.
“What we hear from the workers is that they’re holding on to their jobs for dear life, if they have them,” Hammack said. “But what I also heard … was that the money that they have coming in is just not stretching as far as it used to. What used to cost $30 now costs $50, and so that inflationary pressure is still very salient for them.”
Mixed Signals from Employment Data
On the day Hammack spoke, the U.S. Labor Department put out the September nonfarm payrolls report. Her words join dual messages: payroll growth went strong, yet the jobless rate rose a bit. This mix ties together the ideas of recovery and current troubles in the labor market.
As a voting FOMC member in 2025, Beth Hammack’s words carry weight in making policy. Her push to keep rates near current levels joins caution on inflation with a care for steady growth.
Investors and policymakers will watch the December meeting. They wait to see how the Fed will work with these shared pressures. For now, Hammack’s words tie the need for steady watchfulness with the fight against rising inflation without loosening policy too fast.
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