President of the Federal Reserve Bank of Minneapolis on inflation
(CBS, KYMA/KECY) - Neel Kashkari spoke with Margaret Brennan on Face the Nation Sunday about inflation, the job market, and interest rates.
"We need to see more evidence to convince us that inflation is well on our way back down to 2%. The good news is, as your reporting just indicated, the job market remains strong. But there's a really important difference between the U.S. and those other countries. The U.S. economic fundamentals are much stronger than in most other advanced economies around the world. So they're facing declining inflation and economic weakness. We're facing declining inflation slowly, but economic strength, and that's what's leading to this divergence in monetary policies."
Neel Kashkari, President, Federal Reserve Bank of Minneapolis
During the interview, Brennan and Kashkari talked about the impact of a worker shortage in essential roles.
"The big inflation that we saw over the last few years, a lot of it was driven by disruptions in supply. There's not enough workers, as well as supply chains getting disrupted. Many of those things have gotten a lot better. Workers have come back, as you just indicated, a lot of immigration, that's helped fill a lot of the jobs that have been open. Those have, on the margin, helped to bring down inflation. Now, the net effect of immigration long run, you know, obviously, immigrants, they work hard, they contribute to our economy, they also need a place to live, they also need a place to- they also eat. So they also have demand for services and goods. So what the net effect on inflation is over the long run is a little bit harder to judge. But I think right now, the fact that many Americans are coming back to work and taking jobs that need to be filled, that's really helping our economy get back on track. And so we just have to finish the job. We're at around the 3% inflation rate right now, we got to bring it all the way back down to our 2% target."
Neel Kashkari, President, Federal Reserve Bank of Minneapolis
To watch more of Brennan's interview with Kashkari, click here.
