Neel Kashkari, Interview: South Dakota State University’s Ness School of Management and Economics

Fed Funds

“So at the next meeting, which is mid-December, I don’t know what we’re going to do. There’s a lot of talk in the public about might we raise rates by 50 basis points? Might we raise rates by 75 basis points? Those are certainly going to be on the table, but could it be something beyond that? It’s possible too. So I don’t know exactly. I think we’re on a good path right now in terms of what I would do if I was king. I think we’re on a good path right now. I think we are united in our commitment to getting inflation back down to 2%.”

Pace of Hikes

“But monetary policy operates with a lag. So some people have said, “Well, why don’t you just go one move? Go up three percentage points in one move.” And the answer is, monetary policy takes time to work its way through the economy. And by moving aggressively but taking a few steps, we get to see how the economy evolves, we get to see what’s happening with supply chains, and that reduces the risk that we’re going to overshoot our mark. And so I think we’re on a good path right now.”