Kashkari Signals Hawkish Stance on Inflation Amid Energy Price Surge
Minneapolis Federal Reserve President Neel Kashkari emphasized that inflation pressures in the US economy extend far beyond recent energy cost increases. In an appearance on Fox News' 'Sunday Morning Futures', he noted that underlying inflation remains too high even when excluding food and energy prices, which are highly volatile.
Kashkari supported the Federal Open Market Committee's (FOMC) decision to raise the benchmark federal funds rate by a quarter percentage point to 3.75-4.00%, citing the need for tighter policy. The move comes after the US and Iran attacked oil tankers in the Strait of Hormuz, causing crude prices to surge.
Kashkari acknowledged that geopolitical events can impact energy markets but stressed the Fed's limitations in addressing supply-side shocks. He stated that 'the inflation that American people are feeling every day is much beyond just oil prices,' and emphasized the need for a comprehensive approach to tackling inflation, rather than focusing solely on one factor.