Minneapolis Fed President Kashkari Says Time to Begin Gradually Raising Rates, Backed 25 Basis Point Hike on Wednesday

According to Odaily, Minneapolis Federal Reserve President Neel Kashkari stated on Wednesday that the Federal Reserve should begin gradually raising interest rates to control inflation and avoid the need for sharper hikes in the future. Kashkari was one of three FOMC voters who supported a 25 basis point rate increase at last week's meeting.

Kashkari cited strong corporate earnings, resilient consumer spending, and labor market strength as evidence that monetary policy is not yet sufficiently restrictive. He emphasized the approach should involve "small steps" rather than large rate increases, aimed at preventing inflation from becoming entrenched and necessitating aggressive tightening later. He noted uncertainty around the Fed's September actions, with future data playing a decisive role.