In a recent interview on “Face the Nation”, Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, shared his views on the current state of the U.S. economy and the potential impact of inflation on the labor market.
Despite the economy’s resilience and a low unemployment rate of 3.6%, Kashkari acknowledges the hardships Americans are facing due to high inflation over the past few years, CBS News reports.
“I personally don’t think that’s realistic, that we’re going to end this inflation cycle with no cost to the labor market. It would not surprise me to see the unemployment rate tick up from 3.6 to 3.7, 3.8, maybe even 4%. That in my book- that would still be a soft landing,” Kashkari said during the interview.
Kashkari’s comments appear ahead of the next job market report to be released by the U.S. Bureau of Labour Statistics on August 4.
On Future Rate Hikes: When asked about future rate hikes, Kashkari stated that if the Federal Reserve is able to bring down inflation to 2%, it would mean a significant outcome for the country.
“We can get back to the kind of economy we had before the pandemic, which was very low unemployment, low inflation, modest, but positive real wage gains for the American people. That is absolutely achievable, but we need to finish the job,” he added.
Source: Benzinga
