Fri, Jan 21, 2022 @ 01:09 GMT
HomeLive CommentsMinneapolis Fed Kashkari: Fed might be one hike away from achieving neutral

Minneapolis Fed Kashkari: Fed might be one hike away from achieving neutral

Minneapolis Fed President Neel Kashkari is seen clearly as a dove as he voted against al three of Fed’s rate hikes last year.

He said in a WSJ interview published today that fiscal stimulus of the federal government, including tax cuts would make Fed meeting its 2% inflation target more likely. The tax cuts and spending increases are “macroeconomically significant, and they are big enough to have an effect on the trajectory of the economy… that could change things in a meaningful way.” And with that development, Fed can move ahead with the planned tightening.

But he also argued that “it isn’t going to be obvious to me once we achieve our inflation target that we need to now put the brakes on the economy.” He reiterated his stance that ” once we achieve our inflation target, we should try to get to neutral in a reasonable period of time,”

And he added that “we might be one hike away from achieving neutral.”

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