Kashkari: Fed has more work to do to control inflation

By Michael S. Derby

NEW YORK (Reuters) – Federal Reserve Bank of Minneapolis President Neel Kashkari said on Monday that the U.S. central bank likely has more work ahead of it to control inflation.

“The economy has proved to be really resilient even though we’ve raised interest rates a lot over the past couple of years. That’s good news,” Kashkari said in an interview on the Fox News television channel.

But he added: “We haven’t completely solved the inflation problem. We still have more work ahead of us to get it done.”

Kashkari’s comments suggested he is still leaning toward raising interest rates again. The Fed met last week in a gathering that kept its overnight short-term interest rate target unchanged at between 5.25% and 5.5% and preserved the option to raise rates again as inflation is still well above its 2% target.

But with price pressures falling, many in markets believe the Fed is done with raising rates.

Kashkari said recent inflation data has been good and moving lower, which he welcomed. But he added: “I’m a little nervous about declaring victory too soon,” noting he wants to see more data before deciding what he thinks the Fed should do next.