Fed's Kashkari predicts two more rate cuts this year

Minneapolis Federal Reserve Bank President Neel Kashkari said he supports the Fed's decision to cut interest rates this week and has included two more rate cuts this year in his forecast. "I believe the risk of a significant rise in unemployment is sufficient to prompt the committee to act to support the labor market," Kashkari wrote in an article published on his Fed website on Friday. Fed officials cut interest rates by 25 basis points at their Wednesday meeting, the first cut since December, citing the need to support a more fragile job market. The Minneapolis Fed president does not vote on monetary policy this year but participates in Federal Open Market Committee discussions. He had previously projected that two cumulative rate cuts would be sufficient for 2025. The Fed will hold two more policy meetings this year, in October and December. Kashkari added that the Fed should not "presume a set path of a series of rate cuts." If the labor market appears more resilient than it currently appears or inflation rises, he would favor holding steady; he would even consider raising rates if economic conditions warrant. (Jinshi)