Minneapolis Fed President Neel Kashkari has indicated Fed’s willingness to raise rates if necessary but maintains that the approach will be dictated by incoming data, as he said on CBS’s Face the Nation on Sunday
Kashkari called that a “good progress as core inflation moved from 5.5% a year ago to 4.1%. However, he was quick to caution against complacency, adding, “But it’s still double our 2 percent rate. And so we don’t want to declare victory.”
His emphasis on a flexible, data-driven strategy was further evident in his comments, “If we need to hike — raise rates further from here, we will do so. But we’re going to let the data guide us and not prejudge the outcome.”
On the topic of future rate decisions, Kashkari kept all options open: “September and beyond. You know, we may or may not raise in September, but we also will continue to watch all the data, the inflation data, the wage data, as well as the unemployment data to make those assessments.”
Despite recent uncertainties, Kashkari expressed optimism about the economy’s resilience: “The economy continues to surprise how resilient it is. The base case scenario seems to be that we’ll have a slowing economy, but that we would avoid a recession.”
