Fed's Paulson (2026 voter) says inflation remains too high and interest rate cuts may only happen after inflation is controlled, also says current policy is appropriate and it is healthy for markets to consider extended hold or hikes

Says: US labour market is stable and consumption is slowing but is resilient. Rate hike may be considered if growth moves above potential or other inflation risks emerge. Recent yield moves are driven by rural rates, not inflation. Reiterated that he did not see a need to change language at the last policy meeting. Risks are 'super-elevated' right now to both inflation and the outlook.