{
  "id": 11184965,
  "title": "Fed's Kashkari: Will put pressure on different parts of economy if we keep raising rates",
  "url": "https://urgent.news/2026/10/01/feds-kashkari-will-put-pressure-on-different-parts-of-economy-if-we",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-01T11:50:19.000Z",
  "source": {
    "name": "FXStreet",
    "slug": "fxstreet",
    "url": "https://www.fxstreet.com/news/feds-kashkari-will-put-pressure-on-different-parts-of-economy-if-we-keep-raising-rates-202610011150"
  },
  "original_language": "en",
  "account": "Minneapolis Federal Reserve President Neel Kashkari stated on Thursday that if the central bank continues to raise interest rates, they will exert distinct pressures on various sectors of the economy, according to Reuters. Kashkari delivered a moderately hawkish message, scoring a 5.4/10 on the FXS Speechtracker scale, which is slightly softer than the historical average of 6/10, yet still indicating firm policy stance. He highlighted the surprisingly resilient economy, strong consumer spending, and robust labor market, along with the potential for a prolonged investment cycle driven by artificial intelligence. These factors reinforce the argument for maintaining elevated interest rates, despite acknowledging mounting challenges in housing-related industries and the significant discrepancy between 2-year yields and short-term rates. The focus on inflation concerns over interest rates in the Minneapolis district reveals that price pressures continue to be a primary concern, supporting a bias towards restrictive policy measures for the US Dollar. The FXS Fed Sentiment Index declined by 1.87 points to 141.41, indicating a modest decrease in perceived hawkishness compared to recent statements. However, the index remains well above the neutral 100 mark, implying that the Fed's tone is still clearly hawkish. The persistent resilience of the economy is evident, with AI potentially prolonging the investment cycle. There is a substantial gap between 2-year yields and short-term rates, and sectors closely linked to housing are under considerable pressure. Consumer spending remains robust across the economy, and the labor market is generally healthy. Diesel availability, trucker presence, and broader inflation concerns are of particular interest in the Minneapolis district. Federal Reserve policy is driven by two mandates: achieving price stability and promoting full employment. The primary tool for achieving these goals is adjusting interest rates. When prices rise too rapidly and inflation exceeds the Fed's 2% target, the central bank raises interest rates, which increases borrowing costs across the economy and strengthens the US Dollar. Conversely, if inflation falls below 2% or unemployment becomes excessive, the Fed may lower rates to encourage borrowing and support the Dollar. The Federal Reserve convenes eight policy meetings annually, where the FOMC deliberates on economic conditions and formulates monetary policy decisions. The FOMC consists of twelve officials, including the seven governors of the Federal Reserve Board, the president of the Federal Reserve Bank of New York, and four rotating regional Reserve Bank presidents, each serving a one-year term. In extreme circumstances, the Fed may employ Quantitative Easing (QE), a non-standard policy measure utilized during crises or when inflation is exceptionally low. QE involves the Fed printing more dollars and purchasing high-grade bonds from financial institutions to boost credit flow in a struggling financial system. Quantitative tightening (QT) is the opposite process, where the Fed reduces bond purchases and stops reinvesting maturing bond principal to buy new bonds, typically benefiting the US Dollar.",
  "summary": "Minneapolis Federal Reserve (Fed) President Neel Kashkari told Bloomberg on Thursday that if they keep raising rates, they will put different pressure on different parts of the economy, per Reuters.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}