Exclusive: Fed's Kashkari Says Weaker Job Market Should Open Door to September Cut
"Minneapolis Fed President Neel Kashkari signaled he would be open to lowering interest rates at the central bank’s next meeting because of a rising possibility that the labor market weakens too much.
“The balance of risks has shifted, so the debate about potentially cutting rates in September is an appropriate one to have,” Kashkari said in an interview.
In June, Kashkari had said he thought a rate cut might not be warranted until the end of the year. But the
rise in the unemployment rate, to 4.3% in July from 3.7% at the start of the year, points to greater risks of an undesirable slowdown.
“If we were not seeing evidence that the labor market was weakening, if the unemployment rate was still in the 3.7% to 3.8% range, I don’t think I would be even debating, ‘Hey, is now the time to cut rates?’” said Kashkari.
Instead, he said, the conversation has shifted because “inflation is making progress and the labor market is showing some concerning signs.” ..."