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Dallas Fed President Lorie Logan said she estimates the federal funds target range may need to rise by another 50 basis points or more to balance the economic outlook and risks. That is Logan’s personal assessment—not an FOMC decision, a committee commitment, or a timetable for future moves.
What Logan said about further rate increases
In prepared remarks on October 1, 2026, Logan said: “I currently estimate the target range needs to rise an additional 50 basis points or more to appropriately balance the outlook and risks for our dual mandate goals.” The estimate followed a 25-basis-point increase at the September 2026 FOMC meeting. Her speech did not state the resulting target-range endpoints.
Logan did not specify when another increase should happen or identify a precise endpoint for rates. She said the rate that makes policy restrictive is uncertain and depends on the broader financial environment. The Dallas Fed notes that Logan’s views are her own and do not necessarily represent official positions of the Federal Reserve System. Read the prepared remarks.
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Inflation remains above the Fed’s goal
Logan said inflation was declining but trending toward the mid-2% range, still above the Federal Open Market Committee’s 2% goal. She described the preceding half-decade of above-target inflation as a serious strain on household budgets. In her view, policy needs to become restrictive to bring inflation back toward the goal; without that restraint, inflation would likely remain above target.
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Growth and consumer spending are resilient
Logan characterized economic growth as strengthening and consumer spending as resilient. She argued that this strength, alongside inflation above target, suggested the existing policy stance was not restrictive enough. At minimum, she said, some additional increases would reverse the risk-management rate cuts made the previous autumn.
The labor market appears balanced
Logan cited an unemployment rate of 4.1%, which she said was close to most estimates of the lowest sustainable level. She described the labor market as balanced. Her account therefore weighs the need to restore price stability against maintaining maximum employment, the two parts of the Fed’s dual mandate.
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How rising long-term yields could change the calculation
Logan also pointed to a countervailing force: long-term yields had risen significantly. Market contacts attributed the increase to expectations of stronger nominal growth and a higher neutral interest rate; some model decompositions also assigned a role to higher term premiums as well as higher risk-free rates. She cautioned that those decompositions depend on models and subjective judgments.
Higher long-term yields can tighten financial conditions without another move in the federal funds target. Logan said, “But higher term premiums can slow the economy, reducing the need to tighten monetary policy.” That is a conditional offset to her estimate, not a conclusion that further increases are unnecessary: if elevated yields do enough to slow activity, the Fed may need less additional tightening.
Why 50 basis points is not a promised path
Logan’s figure is an estimate of the additional increase she believed would appropriately balance the outlook and risks when she spoke. It should not be read as a vote by the FOMC, a guaranteed sequence of moves, or a stated terminal rate. Her remarks do not establish that the committee adopted her estimate.
She emphasized the uncertainty around how much restraint is needed: “The level of the fed funds target range that creates some restriction is uncertain. It changes over time and depends on the broader financial environment.” She said she would assess labor conditions, prices, growth, consumption, and financial conditions as the outlook evolves.
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What to take from the remarks
- Logan’s estimate: an additional 50 basis points or more, beyond the September 2026 increase of 25 basis points.
- Her case for tighter policy: inflation remained above the 2% goal, while growth and consumer spending were strong and the labor market appeared balanced.
- The important offset: higher long-term yields, especially term premiums, could slow the economy and reduce how much further the Fed needs to tighten.
- What remains uncertain: the precise rate level that would be restrictive, the amount and timing of any future committee action, and the eventual endpoint.
The Dallas Fed archive lists the October 1 appearance as a Voices of the Eleventh District event. See Logan’s 2026 speeches.
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