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Fed's Kashkari: By the end of this year, I see rates at 1.75%-2%
FED'S KASHKARI: BY THE END OF THIS YEAR, I SEE RATES AT 1.75%-2%- ESSAY.
— Breaking Market News (@financialjuice) March 18, 2022
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FED'S KASHKARI: I SEE THE NEUTRAL RATE AT 2%.
— Breaking Market News (@financialjuice) March 18, 2022
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FED'S KASHKARI: IF INFLATION PERSISTS, THE FED WILL NEED TO RAISE RATES SLIGHTLY ABOVE NEUTRAL TO ALLOW INFLATIONARY DYNAMICS TO UNWIND.
— Breaking Market News (@financialjuice) March 18, 2022
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Kashkari: Update on Inflation and Monetary Policy
I often remind myself of this quote. While I am not Abraham Lincoln, if Lincoln could admit when he was wrong, then I should be able to as well. When inflation accelerated last year, I argued that it was likely due to transitory factors which would soon pass. That hasn’t happened. This essay lays out the basic arguments I made then, the data that has come since, what I got wrong, and the potential implications for monetary policy going forward.1 Inflation In the September 2021 Summary of Economic Projections (SEP), I estimated inflation would be 4.2 percent for 2021 and 1.8 percent for 2022. Actual inflation for ... (full story)