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3/21/2017, 4:43 PM (Source: TeleTrader)
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Fed's Kashkari: Higher rates won't bring faster growth

President of the Federal Reserve Bank of Minneapolis Neel Kashkari said on Tuesday that the American economy is "not growing nearly as fast as anyone would like," but that higher interest rates would not help boost economic growth.

The policymaker was answering a question during a live Q&A session on his Twitter page under #AskNeel in which he was asked how it is possible that the US economy is "doing well," as Fed Chair Janet Yellen said, when interest rates have been at "emergency levels" for eight years. Kashkari responded that lower neutral real interest rates have to be taken into account in this case. The rate-setter also estimated the monetary policy in the US is "about 75 basis points" accommodative today relative to the neutral real rate, but advised that neutral rates change over time.

Kashkari, who is known for his dovishness, is a voting member of the Federal Open Market Committee this year.

Breaking the News / IB