Fed’s Cook Says Inflation “Too High” as Gold Surges Past $4,250

Federal Reserve Governor Lisa Cook delivered a familiar warning in a speech in Anchorage on August 5th: price pressures remain stubborn. Citing a 3.7 percent annual rise in the Personal Consumption Expenditures (PCE) price index through June, Cook said flatly, “Inflation is too high.” Core PCE, which strips out food and energy, is running at 3.3 percent, still well above the Federal Open Market Committee’s (FOMC) 2 percent goal. Cook’s remarks landed on the same day that gold briefly touched a record $4,252 per ounce, a reminder that investors continue to seek refuge from policy and inflation uncertainty.

Behind the headline numbers, Cook painted a picture of an economy that is in uncertain territory. Real gross domestic product (GDP) expanded at a 1.8 percent annualized rate in the first half of 2026, and she expects a quicker pace later in the year. Business fixed investment jumped 10 percent, powered by companies racing to build artificial-intelligence (AI) infrastructure, while consumer spending advanced a still-respectable 2 percent. Housing remains the weak link, with residential investment off 3 percent and the national unemployment rate holding at 4.2 percent as job gains slow to roughly 100,000 per month.

Cook nevertheless sees several forces threatening to reignite price pressures. Energy-price shocks, tied to conflict in the Middle East, are rippling through oil and gas markets. Meanwhile, surging semiconductor demand from AI projects is straining supply chains. Although fading tariff effects and a projected year-end easing in crude prices could help, she warned that inflation has exceeded target for more than five years, raising the danger that elevated price expectations could become entrenched. Her bottom line: if the disinflationary forces do not materialize, additional rate hikes remain on the table.…