It is "unlikely" the Federal Reserve would adopt negative rates, Federal Reserve Bank of Minneapolis President Neel Kashkari said Wednesday.
In the United States, he said in a fireside chat, it is "unlikely the Fed would adopt a policy of negative rates," taking other steps, including quantitative easing before considering negative interest rates.
Asked if the Fed is behind the curve on interest rates, Kashkari said he uses a "risk management perspective." Inflation remains below target and the unemployment rate hasn't declined as labor force participation increased, so "the economy still has room to run before it overheats."
Also, because of a low federal funds rate target, it's easier to "lock down inflation" if needed, although when inflation is too low, at this point, there are "fewer tools."
As for the next year or two, Kashkari said he sees "slow but steady" moderate economic growth around 2%.
