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Fed's Kashkari calls negative interest rates 'perverse'

Published 05/25/2016, 12:26 PM
Updated 05/25/2016, 12:30 PM
© Reuters. Minneapolis Fed President Neel Kashkari speaks during an interview at Reuters in New York

© Reuters. Minneapolis Fed President Neel Kashkari speaks during an interview at Reuters in New York

(Reuters) - Minneapolis Federal Reserve Bank President Neel Kashkari said on Wednesday that negative interest rates, used by central banks in Europe and Japan to stimulate their economies, would only be a last resort for the U.S. central bank.

© Reuters. Minneapolis Fed President Neel Kashkari speaks during an interview at Reuters in New York

Speaking in Bismarck, N.D. at an oil industry conference, Kashkari said he expects moderate growth for the U.S. economy ahead, and called incentives from negative rates "perverse" because they could scare households and businesses away from the making the very investments they are meant to encourage. The Fed has other tools at its disposal to help boost the economy, he said.

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