(Bloomberg) -- The Federal Reserve could lose credibility if it were to consider changing its 2% inflation target before achieving that goal, Richmond Fed President Thomas Barkin said.

“It’s not like 2% is some magical unicorn of a number that we could never hit,” Barkin said Tuesday at an event hosted by the Danville Pittsylvania County Chamber of Commerce in Danville, Virginia. 

The Fed’s preferred inflation gauge — the personal consumption expenditures index — rose 3% from a year earlier in June, marking the smallest increase in more than two years. That’s down from as much as 7% last year as Fed officials embarked on their most aggressive policy-tightening campaign in a generation.

Prominent economists have called for central banks including the Fed to consider a higher target. 

Olivier Blanchard, a former chief economist at the International Monetary Fund who’s now a fellow at the Peterson Institute for International Economics in Washington, said last year that central bankers should stop tightening policy when inflation drops to 3% and set that as the new target. 

Harvard University professor Jason Furman, who was chairman of the White House Council of Economic Advisers from 2013 to 2017, called for the Fed to “start making a hawkish pivot to a higher inflation target” in an opinion piece in the Wall Street Journal over the weekend. 

The Fed raised its benchmark interest rate last month to a target range of 5.25% to 5.5%, the highest level in 22 years. The debate is now shifting from how high rates need to go to how long they should stay elevated.

Read More: Fed Officials Shift Rates Debate From ‘How High’ to ‘How Long’

Barkin, who doesn’t vote on monetary policy decisions this year, didn’t opine on when he thinks rate cuts might start. He said criteria that might allow for a reduction in rates include seeing when inflation cools month to month and looking at demand that has settled.

A monthly Bloomberg survey of 68 economists conducted Aug. 11-16 showed forecasters do not expect the central bank to cut rates until the second quarter of next year — which is three months later than July’s estimate.

Barkin on Tuesday repeated a speech he gave on Aug. 3 and Aug. 8, in which he said the greater-than-expected easing in inflation in June may be an indication that the US economy can have a “soft landing,” returning to price stability without a damaging recession. 

Even if a recession emerges, less dislocation in the labor force due to strong demand for front-line workers, latent demand by consumers for supply-constrained items like cars and conservative moves by businesses to manage inventory should lessen its severity, Barkin said.

(Updates with economists’ views in fourth paragraph.)

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