The Fed: Fed’s Kashkari could support another 75bp rate hike in July

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Minneapolis Federal Reserve President Neel Kashkari said Friday he could support another 75 basis point interest rate hike by the Fed in July.

“I supported increasing the federal funds rate by 75 basis points at this weeks meeting and could support another such move in July,” Kashkari said, in a blog post.

The Minneapolis Fed president said a “prudent strategy” after the July meeting might be to continue with 50bp hikes until inflation is well on its way down to 2%.

Kashkari has been a leading policy dove on the central bank.

He said he thinks the supply shocks restraining supply will begin to subside next year, which would allow the Fed to relax policy somewhat in 2024.

“However, if the supply side of the economy does not improve, or if inflation expectations drift higher, then we might need to continue raising rates beyond what I forecast,” he said.

See also: Fed dissenter George says jumbo interest rate rise this week risked adding to ‘policy uncertainty’

U.S. stocks
DJIA,
-0.23%

SPX,
-0.00%

were mixed Friday following steep losses in the prior day session on concerns the Fed’s aggressive strategy might push the economy into a recession. The yield on the 10-year Treasury note
TMUBMUSD10Y,
3.230%

rose to 3.24%.

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