responsibilities at the fed, which is bank regulation and supervision. i am sure that we will have the opportunity to discuss many issues of interest to you during our discussion, but i ’ d like to mention a pending rulemaking that would update the community reinvestment act. i understand that the draft rule was intended to provide greater clarity to banks regarding community development activities and their consideration for cra. while i am a strong supporter of the fundamentals behind cra, and i support community development activities, i am concerned that the proposal does not adequately account for the costs and benefits of certain provisions, and that no attempt has even been made to either ensure that or to analyze whether the benefits exceed the costs, which is a fundamental element of effective regulation. the comment period for the proposal ended on august 5, and i will repeat what i have said in the past : if this proposal affects you or your business, i - 7hope that you made your voice heard by submitting a comment to the more than 600page proposal within the short 90 - day comment period. public comments really do matter when considering the content of proposed rulemakings. of course, my comments about the benefits of public participation in rulemaking apply beyond the cra proposal, and there are other regulatory topics on the horizon that would benefit from robust engagement. one that comes to mind is the regulatory framework for analyzing bank mergers. earlier this year, the justice department requested comment on whether to revise their 1995 bank merger competitive review guidelines, seeking input on a wide range of issues. the fdic also issued a request for information on the bank merger act framework. i expect this review will be a focus across the banking agencies, and i will be very interested to see how the framework for small and regional banks is affected by any proposed change. i would be concerned about any changes that would result in making mergers among these institutions more difficult or would not address some of the longstanding issues with the existing framework. among those are that the framework doesn ’ t account for new technologies or overwhelming competition posed by credit unions, internet based financial services, and non - bank financial companies. another concern is that overly strict criteria for mergers could have the unintended consequence of depriving consumers in some areas of access to any banking services. “ banking deserts ” in rural and underserved areas are a real problem and regulators should guard against this outcome when proposing or evaluating rules. i should also briefly mention three other regulatory topics of interest to all

for release on delivery 12 : 15 p. m. edt ( 10 : 15 a. m. mdt ) august 6, 2022 fighting inflation in challenging times remarks by michelle w. bowman member board of governors of the federal reserve system at 2022 ceo & senior management summit sponsored by the kansas bankers association colorado springs, colorado august 6, 2022 thanks to the kansas bankers association for the invitation to share my perspective on the economy and bank regulation. it is always a pleasure to be here with you for this annual gathering. i am especially looking forward to hearing what is on your minds about supervision and regulation, how you are navigating current economic conditions, and your expectations going forward. i ’ ll start with a recap of the decision from july ’ s federal open market committee meeting and then move on to my thoughts about the current economic uncertainty and challenges that lie ahead. the number one challenge, of course, is inflation, which continues to be much too high, and a heavy burden for households and businesses. as i ’ m sure you all already know, the federal open market committee decided last week to raise the federal funds rate by 75 basis points, to a range of 2¼ to 2½ percent. i will share my reasoning for supporting this increase and why i support continued increases until inflation is on a consistent path to significantly decline. i will then touch on the current federal regulatory climate and the fed ’ s agenda for supervision. inflation continued to climb in june, reaching 9. 1 percent as measured by the consumer price index. this is yet another concerningly high reading, and it set another 40 - year record high despite the expectation of many forecasters that inflation had peaked earlier in the year. i have seen few, if any, concrete indications that support this expectation, and i will need to see unambiguous evidence of this decline before i incorporate an easing of inflation pressures into my outlook. many of the underlying causes of excessive inflation are the same as they have been over the past year or so — supply chain issues, including those related to china ’ s - 2covid containment policies, constrained housing supply, the ongoing conflict in ukraine, fiscal stimulus, and limitations on domestic energy production. regardless of the source of the inflationary pressure, the federal reserve has a duty to bring inflation down to our 2 percent target. this duty is mandated by congress to carry out monetary policy that results in price stability — meaning low and stable inflation. we all understand why this