01:08 PM EDT, 05/06/2024 (MT Newswires) -- The current level of interest rates is suitable to ease demand and lower inflation, but the Federal Open Market Committee can make adjustments as needed, Richmond Federal Reserve President Tom Barkin said Monday.

"I am optimistic that today's restrictive level of rates can take the edge off demand in order to bring inflation back to our target," Barkin told the Columbia Rotary Club in Columbia, South Carolina. "While I don't see the economy overheating, the Fed knows how to respond if it does. And if the economy slows more significantly, the Fed has enough firepower to support it as necessary."

He said the recent string of disappointing inflation data after signs of improvement late last year is an indication that the Fed needs to be cautious.

"The economy is moving toward better balance, but no one wants inflation to reemerge," Barkin said. "We have said we want to gain greater confidence that inflation is moving sustainably toward our 2% target. And given a strong labor market, we have time to gain that confidence."

Barkin is a voter on the Federal Open Market Committee this year.