The Federal Reserve needs to keep raising interest rates until it is sure inflation has hit a ceiling, said Minneapolis Fed President Neel Kashkari on Thursday.
The central bank can’t be overly persuaded by one month’s number, Kashkari said, in a discussion sponsored by the Minneapolis Chamber of Commerce.
“We need to stay at it until we’re sure inflation has stopped climbing,” Kashkari said.
The October consumer and producer price data were both “positive,” he said. “It is starting to look like maybe there is some evidence that inflation is at least plateauing, he added.
Kashkari said his personal view is that once he is certain that inflation has “hit the ceiling” than the Fed can take some time to see the full effects of prior interest rate hikes.
“But I need to be convinced that inflation has at least stopped climbing, that we’re not falling further behind the curve,” he added.
The Minneapolis Fed president, who will be a voting member of the Fed’s interest-rate committee next year, said it is an “open question” as to how high the Fed will have to raise interest rates to control inflation.
Stocks
DJIA,
+0.59%
SPX,
+0.48%
were lower in late trading on Thursday while the yield on the 10-year Treasury note
TMUBMUSD10Y,
3.827%
rose to 3.78%. Markets were rattled after St. Louis Fed President James Bullard said earlier Thursday that the Fed’s policy rate needed to get into a zone between 5%-7% to bring inflation down.
Source: https://www.marketwatch.com/story/fed-must-keep-raising-rates-until-it-is-certain-inflation-has-stopped-climbing-kashkari-says-11668714954?siteid=yhoof2&yptr=yahoo
Fed must keep raising rates until it is certain inflation has stopped climbing, Kashkari says
The Federal Reserve needs to keep raising interest rates until it is sure inflation has hit a ceiling, said Minneapolis Fed President Neel Kashkari on Thursday.
The central bank can’t be overly persuaded by one month’s number, Kashkari said, in a discussion sponsored by the Minneapolis Chamber of Commerce.
“We need to stay at it until we’re sure inflation has stopped climbing,” Kashkari said.
The October consumer and producer price data were both “positive,” he said. “It is starting to look like maybe there is some evidence that inflation is at least plateauing, he added.
Kashkari said his personal view is that once he is certain that inflation has “hit the ceiling” than the Fed can take some time to see the full effects of prior interest rate hikes.
“But I need to be convinced that inflation has at least stopped climbing, that we’re not falling further behind the curve,” he added.
The Minneapolis Fed president, who will be a voting member of the Fed’s interest-rate committee next year, said it is an “open question” as to how high the Fed will have to raise interest rates to control inflation.
Stocks
+0.59%
DJIA,
SPX,
+0.48%
3.827%
were lower in late trading on Thursday while the yield on the 10-year Treasury note
TMUBMUSD10Y,
rose to 3.78%. Markets were rattled after St. Louis Fed President James Bullard said earlier Thursday that the Fed’s policy rate needed to get into a zone between 5%-7% to bring inflation down.
Source: https://www.marketwatch.com/story/fed-must-keep-raising-rates-until-it-is-certain-inflation-has-stopped-climbing-kashkari-says-11668714954?siteid=yhoof2&yptr=yahoo