Minneapolis Fed Pres Kashkari (non-voter,.......>

FED: Minneapolis Fed Pres Kashkari (non-voter, dove) has published an article

explaining why he advocated a 50bps rate cut at this week's FOMC meeting.

- "Given that it has taken years for the markets to learn our current reaction

function, I don't believe a rate cut or two in isolation will do much to boost

inflation expectations..."

- "the cost of cutting rates early is much smaller than the cost of cutting too

late... The best way I can think of [reanchoring inflation expectation and

support growth] is...to cut rates by 50 basis points and then commit to not

raising rates until core inflation returns to our target on a sustained basis.

- On balance sheet: "I don't think the remaining roll-off over the next few

months is having much effect on the overall stance of policy. I am agnostic as

to whether to end the roll-off earlier than September. "

- Interesting that he didn't go more than 50bps cuts on the dot plot (we know

this because no member did) if he was advocating 50bps at this meeting alone.