The US economy appears to be gaining strength, with resilient consumer spending and momentum extending beyond the artificial intelligence boom. This keeps the Federal Reserve’s attention firmly on inflation, Richmond Fed President Tom Barkin said on Tuesday, Reuters reported.

Barkin said inflation currently poses a greater threat than weakness in the labour market, explaining that this prompted the Fed to raise interest rates last week. “Will additional hikes be required, and how many?

We'll see,” said Barkin, who is not a voting member of the rate-setting Federal Open Market Committee this year. 00%, with investors expecting further increases.

Barkin’s comments echo concerns among other Fed officials that inflation is being driven increasingly by strong demand across the economy, rather than only by energy prices, tariffs and other supply-related pressures that may ease over time. He further added that even shocks viewed as temporary have lasted longer than anticipated, creating more persistent price pressures.

“I am hearing momentum outside of data centres, too. The defence sector is hot.

Manufacturing contacts are starting to sound more upbeat. Bankers tell us pipelines are healthy,” Barkin added.