Fed's Kashkari: We can get back to 2% inflation under new framework

The US economy is more resilient to the coronavirus because the tolerance of death is much higher than expected, Minneapolis Federal Reserve President Neel Kashkari said on Friday, as reported by Reuters.

Key takeaways

"Two pieces of good news is vaccine effectiveness, recent fiscal stimulus."

"Bad news is slow vaccine rollout and vaccine hesitancy."

"Other pieces of bad news are a higher threshold for herd immunity and new virus strains."

"Current best guess is we will still be with masks and social distancing for all of 2021."

"We can get back to 2% inflation under the new framework."

"Fed does not make monetary policy decisions based on what it means for treasury and US ability to service its debt."

"Wage growth is a very important measure in determining if on track to reach inflation goal."

"Most important now is getting the vaccine out."

"Faster we can vaccinate, faster we can get economy back on track."

Market reaction

The US Dollar Index consolidates its daily gains and was last seen up 0.45% on the day at 90.64.