Federal Reserve (Fed) Board of Governors member Michelle W. Bowman cautioned that there is a real risk that inflation could remain elevated for much longer than many are anticipating. Fed Board member Bowman outlined a far more cautious approach to the Fed's current inflation outlook during a speech at the Massachusetts Bankers Association Annual Convention in Key Biscayne.

Key highlights:

• It remains unclear whether further supply-side improvements will continue to lower inflation.
• Monetary policy appears to be restrictive.
• Bowman sees several upside inflation risks in outlook.
• Continues to hold that inflation should slowly move lower as long as policy holds.
• Remains willing to raise rates further if data shows inflation progress has stalled or reversed.
• Expects inflation to remain elevated for some time.
• The extent of data revisions in the past few years makes assessing the economy even more challenging.
• Geopolitical developments remain a key upside risk to inflation.
• Too-loose financial conditions remains a risk, fiscal stimulus could drive demand higher, stalling or even reversing inflation progress.
• There remains a high risk that consumer, more immigration, and tight labor market conditions could lead to persistently high inflation.