In an exclusive interview on cnbc.com, Chicago Federal Reserve President Michael Moskow said inflation is moving in the right direction, but the Fed isn't prepared to let down its guard.
Speaking with CNBC's Steve Liesman in Chicago, Moskow said economic growth continues to be solid, with weakness centered primarily in housing and, to some extent, the auto sector.
The Fed official pointed to productivity growth, low unemployment and strong demand from countries outside the U.S. as factors supporting his take on the economy.
"Overall, I think the economy is solid," Moskow said.
Moskow and other Fed officials have been focused in on inflationary threats, which they see as more significant than the risk of sluggish economic growth.
"We would expect some monthly ups and downs in the data, but when you look at the broad trend of the economy there is a lot of strength there," Moskow said.