Minneapolis Federal Reserve President Neel Kashkari expressed his support on Tuesday for maintaining current interest rates until there is greater clarity on how higher tariffs will influence inflation.
Kashkari highlighted an ongoing “healthy debate” among Fed policymakers about whether to overlook the inflationary effects stemming from new tariffs. However, he personally finds the arguments against dismissing tariff-driven inflation more convincing.
He emphasized that these concerns justify a cautious approach, advocating for the Fed to hold its policy rate steady until the trajectory of tariffs, their impact on prices, and overall economic activity become clearer.
In response, the U.S. dollar strengthened, with the US Dollar Index (DXY) gaining 0.36% on the day and trading around 99.35.
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