WASHINGTON, May 7 (Reuters) – A strong housing market and possible continued inflation mean monetary policy may not be as tight as previously thought, the Federal Reserve Chairman said of Minneapolis, Neel Kashkari, in a new essay.
A poor estimate of the restrictive level of rates “could explain the constellation of data we observe”, particularly in the housing sector, writes Neel Kashkari.
“The question now is whether the disinflation process is in fact still underway, but is taking longer than expected, or whether inflation will instead settle around 3%, which suggests that the The Fed still has work to do to achieve the objectives of its dual mandate,” describes the monetary policy manager.
Neel Kashkari is considered a “hawk” by observers, meaning he favors a more restrictive monetary policy than most of his colleagues. (Written by Howard Schneider, French version Corentin Chappron, edited by Zhifan Liu)
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