Kashkari: Strong Economy and Efficiency Gains May Lead Fed to Cut Rates Less Than Expected

Minneapolis Federal Reserve President Neel Kashkari stated that the recent strong growth and increase in productivity may indicate a need for higher interest rates. Kashkari, who has not expressed an opinion on further interest rate cuts until the Fed's December meeting, remarked, "I am surprised by how resilient the economy is. If this continues and we have a structurally more productive economy moving forward, that suggests to me that we won’t need to cut as much." He also mentioned that he is not worried about a potential conflict between the Fed and elected President Trump, as both major political parties in the U.S. want to see inflation decrease. Kashkari said, "I am not concerned about the dynamics in Washington. Both sides of the aisle want us to keep the economy strong and bring inflation down. We have made a lot of progress, and we want to finish the job."