Federal Reserve Board Governor Barr outlines community development priorities and says tariffs could push inflation higher

The Federal Reserve Board published a speech by Governor Michael S. Barr on how the Federal Reserve System’s community development function supports monetary policy and supervision under the Community Reinvestment Act (CRA), including by bringing local economic conditions into policy deliberations. Barr also noted he has taken on the role of the Board’s consumer and community development point person, and set out an economic outlook in which disinflation continues toward the 2 percent target but tariffs are expected to add upward pressure to inflation and could slow the economy and lift unemployment. Barr described community development work as complementing national data with on-the-ground intelligence, while also promoting access to credit and other financial services for small businesses and low- and moderate-income households and communities. He highlighted coordination between community development staff and CRA supervisors to help banks identify opportunities to meet CRA obligations, and said insights from this work can serve as an early warning system for risks such as unfair borrower treatment or safety-and-soundness concerns in specific communities. Examples cited included Federal Reserve research, surveys such as the Community Perspectives Survey and the Small Business Credit Survey, qualitative outreach with employers, and convenings and initiatives designed to connect community stakeholders, investors, and local partners. He pointed to the Federal Reserve’s listening sessions around the country on its long-term monetary policy goals and strategy as another channel for public input.