As Marketplace celebrates its 25th birthday this year, we are looking at the surprising, sometimes delightful and sometimes destructive ways that prices have changed during that quarter century. And that means an examination of our old friend inflation.

William Dudley, president of the Federal Reserve Bank of New York, thinks a lot about inflation. He joined Marketplace Morning Report host David Brancaccio to talk about when to raise interest rates to thwart inflation, and why he thinks it’s good to let the economy run “a little hot” before taking action.

Among the topics discussed, Dudley also addresses concerns that the New York Fed has become too deferential to the financial institutions it watches over. This question moved to the foreground after the public radio program This American Life—along with news organization ProPublica—obtained audio recordings made secretly inside the New York Fed. The recordings were made by a former New York Fed employee who later sued for wrongful dismissal. 

Click on the media player above to hear William Dudley, president of the Federal Reserve Bank of New York, in conversation with Marketplace Morning Report host David Brancaccio.