Dallas Federal Reserve President Lorie Logan has said the US central bank needs to raise interest rates at least twice more to bring inflation under control, in some of the most explicit rate guidance offered by a senior American central banker since Kevin Warsh took over as Federal Reserve chair in May.
“It remains clear to me, given the current outlook, that the FOMC needs to implement at least two more 25-basis-point rate increases,” Logan said in remarks prepared for delivery to students at Davidson College on Friday. “After that, it would make sense in my view to pause and examine economic and financial developments to determine what further action may be appropriate.”
Logan was speaking days after joining the majority of the rate-setting Federal Open Market Committee in a 10-2 vote to leave short-term US interest rates in their current range of 3.75% to 4.00%. The committee said at the time that the economy was strong but inflation remained too high.
For Logan, one of the more hawkish voices among Fed policymakers, holding rates this week is not at odds with her call for further tightening. She believes the target rate should be at least half a percentage point higher in order to restrict the economy enough to steer inflation back towards the Fed’s 2% goal. Two quarter-point rises would deliver exactly that increase.
She argued that moving more gradually made sense in the current climate. Financial markets have been volatile in response to news about the technology investment outlook and geopolitical developments, she said, and a steadier pace would help households, businesses and market participants adjust to higher rates while reducing the risk that economic activity weakens more sharply than necessary.
Logan also made the case for being clear about where policy is heading. That view contrasts with Warsh’s insistence that the Fed should only deliver such guidance in times of crisis. For Logan, spelling out the destination matters precisely because financial conditions are currently supporting growth rather than restraining it.
She attributed the recent rise in longer-term borrowing costs to expectations of stronger growth and higher interest rates, rather than treating those higher market rates as a separate drag on activity.
“The higher market rates are more a message that investors believe monetary policy has work to do than an independent headwind for activity,” she said.
Skipping a meeting, she added, does not change the Fed’s policy destination. As long as market participants understand the committee’s plans, she said, the precise timing of each increase has little effect on the longer-term rates most borrowers actually pay.
Sources: Reuters, “Fed needs at least two more rate hikes, Logan says”, 30 October 2026, https://www.reuters.com/business/fed-needs-least-two-more-rate-hikes-logan-says-2026-10-30/
