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Fed’s Neel Kashkari sees 40% chance of ‘meaningfully higher’ interest rates
Minneapolis Federal Reserve President Neel Kashkari thinks there’s nearly a 50-50 chance that interest rates will need to move significantly higher to bring down inflation. In an essay the central bank official posted Tuesday, he said there’s a strong case to be made that the U.S. economy is headed towards a “high-pressure equilibrium.” Such a condition would involve continued growth featuring strong consumer spending and “the economic flywheel spinning.” In that instance, the inflation rate falls but stays above the Fed’s 2% target, posing a challenge for policymakers. “The case supporting this ... (full story)