Arabic version: كاشكاري يدعو إلى زيادات تدريجية في أسعار الفائدة من الاحتياطي الفيدرالي
According to Cnbc, Minneapolis Federal Reserve President Neel Kashkari said Wednesday that the central bank should begin raising interest rates gradually to reduce inflation and avoid sharper increases later.
Kashkari was one of three dissenters at last week’s Federal Open Market Committee meeting, voting for a quarter-percentage-point increase while the other nine voters supported holding the benchmark federal funds rate at 3.5% to 3.75%.
“Corporate earnings are through the roof. They’re doing great. The consumer is hanging in there. The labor market is hanging in there,” Kashkari said in a CNBC “Squawk Box” interview from the Aspen Ideas Festival in Colorado. He said he did not see evidence that monetary policy was particularly restrictive.
He said a gradual move could begin in September but did not commit to a timetable, stressing that incoming data would be important before the committee’s Sept. 15-16 meeting. Markets were pricing a slightly stronger chance of a rate increase in October than next month.
Kashkari said he was not seeking a dramatic rise in rates, but preferred small steps now rather than waiting for inflation to become entrenched. He also said Chairman Kevin Warsh did not pressure him over his dissent, recounting that Warsh told him: “Do what you think is the right thing to do for the economy.”
Philadelphia Fed President Anna Paulson offered a different assessment, saying the current rate level was “mildly restrictive” and that holding rates steady was “not a close call” for her.
