A senior Federal Reserve official has highlighted ongoing challenges with inflation, particularly within the services sector, which remains stubbornly high. The official reiterated the Fed's commitment to achieving its 2% inflation target, noting that price pressures are unlikely to ease in the near term. Upcoming contract renegotiations could further reinforce inflationary trends. The official pointed out that core services inflation, excluding housing, is primarily driven by domestic cost factors rather than external influences like tariffs or imported goods. Despite a strong labor market, the Fed's ability to support employment is limited, with a primary focus on maintaining price stability.