Federal Reserve Governor Michelle Bowman said she saw multiple upside risks to the inflation outlook and reiterated the need to maintain higher borrowing costs for some time. "We have not yet reached a stage where it would be appropriate to lower the policy rate," Bowman said in a prepared speech in London on Tuesday. "Given my consideration of the risks and uncertainties in the economic outlook, I will carefully consider any changes to the stance of monetary policy going forward," she said, noting she was still willing to raise rates if progress in the retreat of inflation stalled. Bowman sees no rate cuts in 2024, with the Fed delaying rate cuts until 2025. Bowman pointed to several areas that could put upward pressure on prices. She said the economy is unlikely to benefit from further supply-side improvements. She cited the largely resolved supply chain disruptions in the pandemic era and the limited growth in the labor force participation rate in recent months. Bowman also mentioned the possibility of stricter immigration policies, saying that while immigration can help increase the labor supply and bring the job market to a better balance, the influx of immigrants into certain areas could put upward pressure on rental costs in those areas due to a lack of affordable housing inventory. Bowman cited the United States' more open immigration policies and the scale of fiscal support since the pandemic as potential reasons for the divergence of the U.S. economy from other major economies in the past few months. She pointed to accelerating wage growth due to tight labor markets, escalating geopolitics, fiscal stimulus and easing financial conditions as additional potential risks to the inflation outlook. Federal Reserve officials have kept interest rates at their highest level in more than two decades for nearly a year and have lowered their expectations for the number of rate cuts this year. "Lowering our policy rate too early or too quickly could lead to a rebound in inflation, which would require the Federal Reserve to further increase its future policy rate to keep inflation at 2% over the long term," she said. Bowman also reflected on the Fed's slow response to the surge in inflation in 2021. She noted that inflation had been low in the years before the pandemic and that the authorities subsequently revised the data. But she also pointed to the role of the Federal Open Market Committee (FOMC) in adjusting its monetary policy strategy in 2020."In my view, these factors, combined with the FOMC's revision of the committee's monetary policy strategy consensus statement in August 2020 and the introduction of new forward guidance in the September and December 2020 statements, have together delayed the removal of monetary policy accommodation in 2021," Bowman said. The Fed is expected to begin another review of its framework later this year. Bowman also reiterated her criticism of U.S. regulators' bank capital proposals. She said the plan proposed by the Fed and other financial regulators last July could have "very significant, adverse effects." Bowman said the plan could prompt banks to scale back some services and affect market liquidity.