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US inflation challenge has not been won yet, Fed's Bostic says

BY Reuters | ECONOMIC | 12:29 PM EST

Jan 14 (Reuters) - The challenge in containing inflation in the U.S. economy "has not been won yet" ?and requires the Federal Reserve to ?continue to be restrictive ?in its monetary policy ?stance, Atlanta ?Federal Reserve President Raphael Bostic said ?on Wednesday.

The ?economy is likely to accelerate through 2026 ?thanks in large ?part ?to tax and other fiscal policies put in place ?by the Trump administration last year, and those tailwinds could continue placing upward pressure on demand and ?prices.

"That ?is something we have to watch," Bostic ?said at an event in Atlanta, saying inflation was "still quite far" from where the Fed needs it to be. ?Bostic has announced he will be retiring from his post early ?this year.

(Reporting By Dan Burns)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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