Minneapolis Federal Reserve President Neel Kashkari says two factors are holding the U.S. economy back right now: President Trump’s trade war and high interest rates.
The current U.S. interest rate is a bit below 2 percent after the Fed lowered it slightly last week. Kashkari would like to see the rate cut to under 1.5 percent to stimulate the economy.
Kashkari said he pushed for a bigger interest rate cut when the Fed’s policy setting committee met last week and that he will continue to advocate for a sizable reduction later this year. He will be one of the 10 Fed leaders who get to vote on the appropriate level of interest rates in 2020.
Trump has repeatedly blasted the Fed as having “no guts, no sense, no vision!” saying it is keeping interest rates too high. He has suggested the central bank should lower rates back to zero, where they were for many years after the 2008 financial crisis. Kashkari, a Republican, says politics plays no role in his advocacy for lower rates and said he is only advocating for “modestly” lower rates.