Fed’s Kashkari Sees Two More Rate Cuts This Year Due To ‘Sharp’ Increase In Unemployment Risk

Kashkari highlighted a “sharp increase” in risks to unemployment, which warrants action from the FOMC to support the labor market.
Minneapolis Federal Reserve Bank President Neel Kashkari visits "Maria Bartiromo's Wall Street" at Fox Business Network Studios on October 11, 2019 in New York City. (Photo by Roy Rochlin/Getty Images)
Minneapolis Federal Reserve Bank President Neel Kashkari visits "Maria Bartiromo's Wall Street" at Fox Business Network Studios on October 11, 2019 in New York City. (Photo by Roy Rochlin/Getty Images)
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Rounak Jain·Stocktwits
Updated Sep 19, 2025   |   8:44 AM GMT-04
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Federal Reserve Bank of Minneapolis President Neel Kashkari said on Friday that he supports the September interest rate cut and expects two additional cuts in 2025.

In an essay published on Friday, Kashkari highlighted a “sharp increase” in risks to unemployment, which warrants action from the Federal Open Market Committee (FOMC) to support the labor market.

Kashkari had expected two rate cuts from the Fed in 2025 even before the September FOMC meeting. Following the 25 bps cut in September, he still expects two additional cuts this year, when the FOMC meets in October and December. However, he said the Fed should not preset its course of action now that it has cut the benchmark rate on Wednesday.

“I do not believe we should be on a preset course for a series of rate cuts. If the labor market proves more resilient than it seems at the moment or if inflation surprises to the upside, we should be prepared to pause and hold our policy rate,” he added, stating that he is even open to the possibility of a rate hike if the economic conditions warrant it.

On Thursday, billionaire hedge fund manager David Tepper said that the Federal Reserve can cut interest rates a bit further, but warned against easing too much.

Tepper expressed concerns that if the central bank cuts interest rates too much before inflation is brought under control, demand could outstrip supply and push prices up again.

Meanwhile, U.S. equities gained in Friday’s opening trade. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was up 0.22%, while the Invesco QQQ Trust (QQQ) surged 0.23%. Retail sentiment around the S&P 500 ETF on Stocktwits was in the ‘bullish’ territory.

The iShares 7-10 Year Treasury Bond ETF (IEF) was down 0.08% at the time of writing.

Also See: Dow Futures Edge Lower As Investors Watch Out For Trump-Xi Call: FDX, UPS, LEN, INTC Among Stocks To Watch

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