Fed's Kashkari is in wait and see mode regarding the tariffs
Fed's Kashkari is in wait and see mode regarding the tariffs and their impacts, in comments on CNBC. The economy and the job market are "quite healthy," but there is some slack given signals from the labor market, the Fed has been mis-reading the market, believing it's maxed out. Analysts still wouldn't be adding 200k+ workers if there weren't slack. He is not so much in the transitory camp on inflation, given the persistence of sub-2% prices. He argues for allowing inflation to run above the 2% goal for sometime to prove the seriousness of the Fed's commitment to the target. Some of the lack of wage pressure, and subsequent price pressures are due to slack in the labor market. Kashkari is not too concerned about a tit-for-tat response to the tariffs given the strength of the U.S. economy and as it's less susceptible trade. As to what he's focusing on in terms of policy, it's wage growth.