Fed’s Kashkari: Rates will stay high for ‘extended period’ and can’t rule out a hike

Minneapolis Fed president Neel Kashkari said Tuesday that he believes interest rates will likely need to be held at current levels for an “extended period” and didn’t rule out a hike if inflation stalls near 3%.

“I think it’s much more likely we would just sit here for longer than we expect or the public expects right now until we see what effect our monetary policy is having,” Kashkari said at the Milken Institute conference in Los Angeles.

But if the Fed were convinced that inflation was entrenched at 3% and rates needed to be raised higher, it is possible it would take such an action.

“That’s not my most likely scenario, but I also can’t rule it out,” he said, adding, “I think the bar for us raising is quite high but it’s not infinite. There is a limit when we say, ‘OK, we need to do more.'”

Jennifer Schonberger | Yahoo Finance

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