Minneapolis Federal Reserve Chairman Neel Kashkari reiterated his opinion that the labor market is still showing signs of slowdown and could improve before the Fed to proceed to further interest rates in 2018.
He added that, according to his estimate, one million workers are out of the labor market and could join the labor force if the labor market continues to grow. "It is better to allow inflation to rise than to trigger premature termination of declining unemployment by raising rates prematurely."
Kashkari outlined the reasons for his disagreement, due to his concern that the dollar yield curve suggests that the bond market relies on low growth and low inflation, despite the tax plan Republicans are planning to vote on.
The tax privileges expected to be accepted will most likely lead to share repurchases instead of investing in new capacities, as the Republicans promise.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov
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