Fed's Kashkari: Inflation Still Too High Despite Softer PCE Data
Minneapolis Fed President Neel Kashkari said inflation remains elevated even after cooler PCE figures, while calling the labor market 'pretty good.'
Minneapolis Federal Reserve President Neel Kashkari maintained a cautious tone on inflation Wednesday, telling CNBC that price pressures remain too elevated despite a softer-than-expected reading on the Fed's preferred inflation gauge, the Personal Consumption Expenditures index.
Speaking exclusively with CNBC's Steve Liesman, Kashkari acknowledged the recent PCE data offered some encouragement but stopped well short of declaring victory, signaling the central bank is not yet ready to shift course on monetary policy. His remarks reflect ongoing caution among Fed officials who have repeatedly stressed the need for sustained evidence of cooling prices before considering rate adjustments.
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On the employment side, Kashkari offered a more upbeat assessment, describing the labor market as 'pretty good' — a characterization that suggests Fed policymakers do not currently see deteriorating job conditions as a trigger for easing policy in the near term. A resilient labor market reduces urgency for the Fed to cut rates as a cushion against economic weakness.
Kashkari's comments land at a sensitive moment for monetary policy watchers. Markets have been closely parsing every Fed statement for clues about the timing of potential rate cuts, with softer inflation data in recent months fueling speculation that relief could come sooner rather than later. His remarks temper that optimism without extinguishing it entirely.
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