In a speech today, Minneapolis Fed President Neel Kashkari indicated that ” further modest reductions in our policy rate will be appropriate in the coming quarters to achieve both sides of our mandate.”
Kashkari stressed that future decisions will be data-driven, stating that “ultimately, the path ahead for policy will be driven by the actual economic, inflation, and labor market data.”
While acknowledging that the current federal funds rate, set between 4.75% and 5%, remains restrictive, Kashkari noted that it is still unclear exactly how much this restrictiveness is weighing on economic growth.
However, he expressed confidence in the Fed’s progress toward its inflation goals, saying the central bank is in the “final stages of bringing inflation down to our 2% target.”
