Kashkari: US Inflation Remains Too High Across Economy

Minneapolis Federal Reserve President Neel Kashkari expressed concern over high inflation across all sectors of the US economy, attributing it to factors beyond rising oil prices. Speaking on Fox News' 'Sunday Morning Futures,' he stated that even after stripping out energy and food from calculations, inflation remains too high.

Kashkari supported the recent rate hike decision, which saw interest rates increase by a quarter percentage point to 3.75-4.00 percent. He was among three officials who dissented at the Fed's prior meeting in favor of a hike when the majority opted to leave rates unchanged.

According to projections released with the rate-hike decision, all but two Fed policymakers expect at least one more quarter-point increase this year. Rate futures markets suggest a two-in-three chance that the Fed's policy rate will end 2026 in the 4.00-4.25 percent range, with a strong likelihood of it climbing by another quarter point beyond that by mid-2027.

Kashkari emphasized that the Fed's job is to bring inflation back down to its 2 percent target and acknowledged that interest rates cannot directly address issues such as the Middle East conflict driving oil prices. However, he expressed hope for assistance from other parts of government or the real economy in achieving this goal.