Fed’s Kashkari: Far, far, far away from claiming victory on inflation

Fed’s Neel Kashkari said while he is happier to see inflation surprised to the downside, the Fed is far far far away from declaring victory on inflation. He added that ”this doesn’t change my rate hike path”, and he is expecting 3.9% end of this year 4.4% end of next year.

He said ”we may be in a recession in the near future and the risk of a recession would not deter him from doing what is needed, getting inflation down to 2%.

The idea of rate cutting next year is not realistic. He said the Fed will raise rates and leave until inflation is well on its way to 2%. Kashkari is speaking following today’s decline in July inflation data.

Prices rose 8.5% on an annualized basis in July, a slower pace than the 9.1% rise reported in June and below analysts’ consensus expectations for an 8.7% rise.