World News

Fed’s Kashkari says he supported rate cut as ‘insurance’ in face of uncertainty

(Reuters) – Minneapolis Federal Reserve President Neel Kashkari said on Thursday that he supported the U.S. central bank’s emergency interest rate cut this week, and added the Fed could cut rates further if the impact of the coronavirus is worse than expected.

“This was an insurance that we took out because nobody knows how bad the virus is going to be,” he said, and uncertainty means that companies are likely to pull back on activity. If in a few months it turns out the impact has passed, he said, the Fed could raise rates back up again.

(Writing by Ann Saphir in Chicago; Editing by Leslie Adler and Sandra Maler)