Minneapolis Federal Reserve Bank President Neel Kashkari said on Thursday that at the U.S. central bank’s meeting last month he pencilled in two interest rate cuts this year but if inflation continues to stall, none may be required by year end.
“If we continue to see inflation moving sideways, then that would make me question whether we need to do those rate cuts at all,” Kashkari said during an interview with Pensions & Investments. “There’s a lot of momentum in the economy right now.”
Kashkari added that if inflation continued to come in stronger than hoped, he anticipates the Fed would hold its benchmark policy rate at the current 5.25%-5.50% range for a longer period of time.
If that still did not work, further rate increases are “not off the table, but they are also not a likely scenario given what we know right now,” Kashkari said.