Fed's Kashkari (2026 voter) says Fed can sit tight as war clouds the outlook, via WSJ interview; 1 or 2 cuts later this year could be appropriate if inflation cools, but war in the Middle East could also create conditions that would justify extended pause

Fed's Kashkari (2026 voter) says Fed can sit tight as war clouds the outlook, via WSJ interview; 1 or 2 cuts later this year could be appropriate if inflation cools, but war in the Middle East could also create conditions that would justify extended pause.

Kashkari's comments suggest a cautious Fed stance amidst geopolitical uncertainty, indicating that while rate cuts could be appropriate if inflation eases, the ongoing conflict may necessitate a prolonged pause. This positions the Fed's decision-making as highly sensitive to both inflation trends and external shocks, potentially impacting market expectations and asset pricing in the currency and fixed income spaces.