For mortgage market participants bracing for a potential interest rate hike from the Federal Reserve this fall, Beth Hammack has some bad news: A single dose of policy tightening may be insufficient to whip inflation down.

“I would say, in general, one 25-basis-point move probably doesn’t do a whole lot for the economy, so it’s probably some number of [movements]. But I don’t want to prejudge what that number is going to be,” the Fed official told Yahoo Finance journalist Jennifer Schonberger in an interview Monday.

Hammack is the president and CEO of the Federal Reserve Bank of Cleveland. Since January, she has held one of the 12 voting seats on the Federal Open Market Committee (FOMC), which sets U.S. monetary policy.

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In July, she was one of three committee members to dissent against the decision to hold interest rates steady for the fifth straight meeting. Like fellow regional bank presidents Neel Kashkari and Lorie Logan, she voted for a quarter-point rate hike.

“The reason that I dissented at that meeting is because I think that now is the time to act,” Hammack said.

“Tension” is a word former Fed Chair Jerome Powell used repeatedly in FOMC press conferences throughout 2025 and early 2026 to describe the contradictory forces impacting U.S. monetary policy. It’s a word Hammack eschewed Monday.

“When I look at policy broadly, I don’t see any tension in our mandate,” Hammack stated. “We’ve been missing on the inflation side for more than five years, but the labor market is right around my estimate of full employment.”

The Federal Reserve has a dual mandate to promote stable consumer prices and maximum employment. On Friday, the U.S. Bureau of Labor Statistics (BLS) reported that nonfarm payrolls declined by 23,000 in July, missing consensus forecasts by a wide margin, though the unemployment rate fell to 4.1% due to sagging workforce participation rates.

Hammack called recent labor market data “mixed,” adding that she prefers to look at longer-term trends. Including July’s contraction, the jobs market has averaged 34,000 monthly payroll additions over the past 12 months, according to BLS data.

“Given some of the changes that we’ve had, both with demographics and immigration, that may be around the break-even number that we need to see,” she said, “and I think that’s what we’re hearing from that unemployment rate at 4.1%.”

Hammack is far more concerned about inflation, calling pressures to that side of the Fed’s mandate “broad-based” and not restricted to one-off shocks from tariffs or the Strait of Hormuz closure.

She also struck a markedly different tone from new Fed Chair Kevin Warsh regarding ongoing questions surrounding the central bank’s communications policy. In July, markets reacted harshly to Warsh’s tight-lipped FOMC press conference, sending longer-dated Treasury yields soaring.

“I think that Fed credibility is built through transparency. It’s built by us being clear with the American public about what our intentions are, about how we are going to go about managing our job, how we’re going to go about delivering on that commitment to 2% inflation, but that doesn’t mean giving forward guidance,” Hammack said. “That means helping to explain our reaction function. It means telling the public how any new piece of data that comes in will impact our overall mosaic and will help inform our decision-making.”