Fed's Hammack says 'now is the time to act' on raising interest rates

JUST IN: Fed's Beth Hammack says 'now is the time to act' on raising interest rates, warning inflation is straining household budgets.

A sitting Fed president just said the quiet part loud. Now is the time to act, and act means raise.

Cleveland's Beth Hammack, speaking from Jackson Hole, says inflation is still running around three percent, well above target, and she's done waiting. Here she is making that case in person. She's a voting member this year, and she already dissented in July when the committee held rates at three and a half to three point seven five, pushing instead for a quarter point hike.

Her worry isn't the monthly numbers, it's the mindset. Five years above target, she says, and people start believing inflation is permanent. She talked about workers in Erie, Pennsylvania who have good jobs and still can't afford an ice cream cone with their kids on the weekend.

Markets aren't listening yet. Traders see the Fed holding in September and October, with nothing until December. So one of the loudest voices in the room says act now, and the room is pricing in four more months of standing still.

This is Sara White, reporting for HIT.