Kashkari Warns Inflation Risks Becoming Entrenched in Broader US Economy

Minneapolis Fed President Neel Kashkari said that inflation pressures are spreading beyond oil prices into the broader US economy, including services. The Federal Reserve raised its benchmark interest rate by 0.25 percentage point at the FOMC meeting to curb inflation, which remains above its 2% target.

Kashkari expressed concern that high inflation could become entrenched, but also gave a relatively positive assessment of the US economy's resilience and labor market strength.

He stated that he hopes for conflicts to ease, growth to pick up momentum, and inflation to decrease simultaneously. If disinflation takes hold, the Fed's job will become easier, according to Kashkari.