Minneapolis Federal Reserve President Neel Kashkari on Wednesday said he is "open-minded" on raising rates by 25 or 50 basis points at the March Federal Open Market Committee meeting as economic data remains concerning.
"I lean towards continuing to raise rates further," said Kashkari during a Q&A session at the SiouxFalls Business CEO Summit. "What's more important is what we signal in the dot plot."
The federal funds rate currently stands at 4.50%-4.75%. Markets have priced in at least a 25-bp rate hike in March, with the probability of a 50-bp hike in increasing to 30.6% from 0% a month ago, according to the CME FedWatch tool.
Kashkari stressed that the U.S. economy is not in a recession right now, and while the Fed would like to avoid recession, getting inflation down is its top priority. While other Fed officials have expressed optimism on a soft landing, he said he's not sure if that can be accomplished.
One cause for concern is that Fed's rate hikes so far have not slowed the services side of the economy, Kashkari said.
Also, wage growth level is currently too high. "We would need to get wage growth closer to 3% a year to be consistent with our 2% inflation target."
While recent data has been troubling, "we don't want to overreact" to just one month of data, he added.
Responding to a question on cryptocurrencies, Kashkari said "it's been 10 years and no one can articulate any actual usefulness in the real world," adding that he is "deeply skeptical".
Meanwhile, Atlanta Fed President Raphael Bostic said the Fed needs to push rate to 5%-5.25% and hold into 2024.