Neel Kashkari, Interview: The Marquette CEO Town Hall

Banking Stresses

“How much of an imprint are those banking stresses having on the broader economy? If they have more of an imprint, then we have to do relatively less with our monetary policy tools. If they have less of an imprint, then the responsibility really is on the Federal Reserve to get inflation back down.”

Fed Funds

“If the markets are right that inflation is going to fall pretty quickly, then one might imagine interest rates normalizing … it really depends on how imbedded is the high inflation that we’re seeing and how quickly is that inflation going to come back down to our two percent target and we’re watching it very carefully.”

If inflation is going to stay high… We’ve been surprised how high it got. We’ve been surprised how persistent it has been. It’s coming down. There’s some evidence it’s coming down. But so far, it’s been pretty darn persistent. That means we’re going to have to keep at it for an extended period of time.

One Possible Future

“So, what’s going to happen when we get through this high inflation period and we get back to whatever normal is.  If I had to guess today, I would tell you my guess is that normal looks like what normal looked like in 2018 and 2019 … low inflation, low interest rates, modest wage growth and decent economic growth.”