Minneapolis Federal Reserve President Neel Kashkari expressed concern over the consequences of insufficient tightening in a WSJ interview, saying, “Under-tightening will not get us back to 2% in a reasonable time.” He favored a stance that leans toward an aggressive policy rather than a cautious one.

In a subsequent conversation with Fox News, Kashkari drew attention to the economy’s endurance despite Fed’s recent rounds of rate increases. “The economy has proved to be really resilient even though we’ve raised interest rates a lot over the past couple of years. That’s good news,” he said. This resilience suggests that the economy might be better positioned to handle further rate hikes, should they be deemed necessary.

However, Kashkari was clear that the Fed’s job is far from over, as inflation remains a critical challenge. “We need to let the data keep coming to us to see if we really have got the inflation genie back in the bottle so to speak,” he conveyed, emphasizing the need for ongoing vigilance. He added, “We haven’t completely solved the inflation problem. We still have more work ahead of us to get it done.”

New York Fed President John Williams maintained a hawkish stance on Fed’s monetary policy, asserting the necessity of persisting with rate hikes to control surging inflation.

“We haven’t said we are done raising rates,” Williams stated yesterday, emphasizing that future decisions would be data-driven, aligning with Fed’s goals. He stressed, “We’ve made incredible progress” on tackling inflation, but left the door open for further policy tightening, saying, “if additional policy firming is appropriate, we’ll do that.”

Williams projected that a restrictive monetary policy stance would be necessary for an extended period to curb inflation from 4% to the targeted 2%. He denied any likelihood of rate cuts in the current year, quashing speculations of such a move. He said, “I do not see in my baseline forecast any reason to cut interest rates this year.”

Addressing the inflation conundrum, Williams declared price pressures “too high” and acknowledged a discrepancy between demand and supply, with the former outpacing the latter. He noted signs of a “gradual cooling in the demand for labor,” as well as for certain goods and commodities, yet emphasized that these were outweighed by the overall demand-supply mismatch.