Investing.com -- Federal Reserve Bank of Chicago President Austan Goolsbee said Tuesday that inflation readings show pervasive price pressures in the US economy and may indicate overheating.

Speaking in an interview on NPR, Goolsbee said the Fed must consider how to break the chain of escalating inflation if the underlying economy is overheating, particularly in services components that exclude energy.

Inflation accelerated 3.8% in April from a year earlier, marking the fastest pace since 2023, according to a Bureau of Labor Statistics report released earlier Tuesday. The increase was driven by an ongoing rise in gasoline prices amid the Iran war.

Goolsbee described the report as worse than expected and expressed particular concern about the pickup in services inflation, which is not impacted by tariffs or the surge in energy prices.

"We've got an inflation problem in this country and we've got to get it back down," Goolsbee said.

Fed officials left interest rates unchanged at their meeting last month. Concerns about inflation are rising among policymakers, as inflation has remained above the central bank's 2% target for five years.