Kashkari Sees More Rate Hikes Needed, Uncertain on Next Move

Minneapolis Federal Reserve President Neel Kashkari expects additional rate hikes to restrain the economy going into 2027. However, he is unsure about whether the next move should happen later this month. The Fed will hold its last meeting of the year on December 8-9.

Kashkari noted that his projections submitted for the September meeting called for one more quarter-percentage-point hike this year and another such move in 2027. He acknowledged that his forecasts have already been challenged, with data suggesting the economy is doing even better than he anticipated.

The Fed raised rates last month to curb high inflation that has overshot the central bank's 2% target for more than half a decade. Kashkari said monetary policy is not doing much to restrain the economy, and that the labor market looks quite healthy right now.