Federal Reserve's Kashkari: Now is the time to begin gradually raising interest rates

Odaily News, 2026 FOMC voter and Minneapolis Fed President Neel Kashkari said in an interview with CNBC on Wednesday that the Federal Reserve should now "begin gradually raising" interest rates to lower inflation and avoid the need for more aggressive hikes later. Kashkari was one of three voters who supported a 25-basis-point rate hike at last week's FOMC meeting.

He stated that corporate earnings are strong, and consumers and the labor market remain resilient, with no evidence that monetary policy has become significantly restrictive—making it the right time to begin gradually raising rates. He emphasized this is not a call for aggressive hikes, but rather a preference for "small steps" to avoid being forced into drastic tightening if inflation becomes entrenched. He added that he is uncertain what action the FOMC will take in September, and that incoming data will play a key role. Meanwhile, Kashkari said Fed Chair Warsh has not pressured him, telling him: "Do what you think is right for the economy." (Jin10)