Fed's Kashkari - Fed should be patient, allow inflation to build

Omkar Godbole FXStreet Contributor

Fed's Kashakri's comments are crossing the wires via Reuters-

Fed should be patient, let inflation build.
Don't know if the US is at full employment.
We are not sure about the neutral rate or output gap either.
Best hope is that tax cuts lead to greater investment and productivity.
Is very focused on wage growth, labor market slack and inflation.
2-percent inflation target would give Fed more flexibility in fighting future downturns.
Fed will respond if inflation starts to show itself.
We are seeing some signs of inflation building, but takes more than one month's data.
Wants to see definitive signs of inflation rising to 2 percent before supporting more rate hikes.
Not in favor of raising Fed inflation target.
Can live with 2.5 percent inflation fore the next 5 years.

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Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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