WASHINGTON- The U.S. Federal Reserve should tighten monetary policy soon and decisively to head off what could become "quite persistent" inflation, World Bank Chief Economist Carmen Reinhart told Reuters in an interview.

Reinhart, who has been warning for some time that supply chain shocks could result in sustained inflation  in the United States and elsewhere, said any delay by the Fed on increasing interest rates would just prolong the problem.

"If inflation is indeed more persistent, my bottom line on Fed policy is ... that if you do more now, you'll be better (off) than if you do too little, too late," Reinhart said ahead of Tuesday's release of the World Bank's World Development Report. 

Reinhart said the Fed had been signaling a modest tightening by historical standards but could shift gears given recent data.

"I'm of the view that if the tendency is to delay action and be more circumspect, it's basically just pushing the problem out in the horizon," she added.

Reinhart has been arguing for about a year that the increase in inflation is unlikely to be temporary because supply chain shocks have affected commodity prices, transport costs, global shipping and other sectors. Escalating tensions between Ukraine and Russia were exacerbating inflationary pressures that had seen oil prices jump 77% from December 2020 to last month.

"All that is not temporary, and inflation proves very few things in life are permanent, but many are quite persistent," she said.

U.S. Federal Reserve officials remain divided over how aggressively to begin upcoming interest rate increases at their March meeting. 

St. Louis Federal Reserve President James Bullard on Monday reiterated calls for a faster pace of Fed interest rate hikes, but other Fed officials have been less willing to commit to a half-point hike.

In a paper published last week, Reinhart and World Bank economist Clemens von Luckner noted that a more timely and robust response from major central banks would drive up funding costs for emerging markets and developing economies and could worsen existing debt crises.

But they said the longer-term costs of delaying action would be great. Because the United States and other advanced economies failed to tackle inflation quickly during the 1970s, they ultimately needed far more draconian policies, which then triggered the second-largest U.S. recession after World War Two and the debt crisis of developing countries, they wrote.

(Reporting by Andrea Shalal; Editing by Cynthia Osterman) ((andrea.shalal@tr.com; +1 202-815-7432;))