Cleveland Fed president Beth Hammack warned Tuesday that it may soon be time to raise interest rates because of concerns that rising prices could get entrenched.

“For today, it’s reasonable to keep rates steady given the uncertainties around the economic outlook,” Hammack said in a speech in Cleveland. “But if recent trends continue, it may soon be appropriate to act.”

Based on the data, Hammack said she’s more concerned about the growing risks of persistently elevated inflation than the risks to full employment. She also noted that interest rates may not be sufficiently restrictive to bring inflation down to 2%.

Read more: How jobs, inflation, and the Fed are all related

“If we wait for definitive evidence that high inflation has become embedded in the economy, it may require larger policy adjustments, at greater cost,” she warned.

Hammack said she mainly hears about plans for business investment, not that credit markets or interest rates are holding companies back. This is telling her that policy may not be restrictive. Rising inflation means the real federal funds rate — the Fed’s benchmark interest rate adjusted for inflation — has actually declined over the past few months.

Looking within the components of inflation, Hammack said she sees relatively broad-based price pressures across goods and nonhousing services.

“The longer inflation remains above our goal, the greater the risk that it feeds into expectations and becomes embedded in wages, contracts, and pricing behavior,” she said.

Jennifer Schonberger is a veteran financial journalist covering markets, the economy, and investing. At Yahoo Finance she covers the Federal Reserve, Congress, the White House, the Treasury, the SEC, the economy, cryptocurrencies, and the intersection of Washington policy with finance. Follow her on X @Jenniferisms and on Instagram.

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