Boston Fed's Collins Backs a 'Steady, Gradual' Path of Rate Hikes as a December Increase Comes Into View

Boston Federal Reserve President Susan Collins wants the central bank to keep raising interest rates, but at a measured pace rather than in big jumps, Reuters reported. "A steady, gradual path seems appropriate to me at the moment," Collins told reporters, adding that she remains open-minded about how policy should evolve. Bloomberg likewise reported that she called for a steady and gradual path of increases.

Collins was careful not to lock herself into a schedule. She said her expectation that the Fed can move gradually does not necessarily imply a particular cadence of hikes.

The Boston Fed chief said the price data of the past three months, together with a job market on firmer footing, have led her to expect a somewhat higher path for rates over the next year than she anticipated a couple of months ago. She described the risks facing the economy as two-sided, meaning the Fed has to watch both inflation and the health of the labor market.

The latest inflation report gave her reasons to worry. The Labor Department's Bureau of Labor Statistics said its consumer price index rose 0.4% in October on a seasonally adjusted basis. Fox Business reported that energy prices drove much of the acceleration.

There is a complication in the numbers. The bureau did not publish most of its usual 12-month comparisons, because October 2025 prices were never collected during last year's government shutdown. Ahead of the report, CNBC noted that Bank of America estimated annual inflation of roughly 3.8% overall and 2.7% excluding food and energy. Whatever the exact yearly figure, the direction is plain: prices are still rising faster than the Fed's 2% goal.

Collins is on the patient side of a committee that has grown more hawkish. The Fed last raised rates in September and is widely expected to lift its 3.75% to 4% target range by a quarter percentage point at its Dec. 8-9 meeting, with another increase anticipated in January, Reuters reported. Recent price data and comments from Governor Christopher Waller suggest some policymakers may want a bigger move next month, while Dallas Fed President Lorie Logan has called for at least two more hikes.

Liberty Bell Report covered Waller's opening to a half-point increase and Logan's push earlier this week. Collins's remarks do not close the door on further hikes; they argue for taking them one step at a time.

For households, a gradual approach matters. Every quarter-point increase ripples into credit card rates, car loans and home equity lines, and it shapes the mortgage rates that buyers face heading into the holidays. Savers, on the other hand, keep earning more on deposits while rates climb.

There is a conservative case for the steady approach as well as for the hawkish one. Inflation is a tax no Congress ever voted on, and it falls hardest on retirees and working families who cannot easily raise their own prices. A central bank that keeps its promise to bring prices back to 2% protects the value of every paycheck. Doing it predictably, without lurching from one meeting to the next, gives businesses and families the clarity they need to plan.

The next clues come quickly. The Fed is scheduled to release the minutes of its Oct. 27-28 policy meeting on Wednesday, Nov. 18, at 2 p.m. Eastern, according to the central bank's calendar. The minutes will show how many officials were already leaning toward larger or faster increases.

After that, the Dec. 8-9 meeting will settle the size of the next move. Policymakers will make that call without the November inflation report, which the Bureau of Labor Statistics has scheduled for Dec. 10, the day after the decision. That leaves October's numbers, the jobs data and the minutes as the main evidence on the table. With Collins arguing for patience and others pressing for more, the debate inside the Fed is no longer about whether rates go up, but about how fast.