Fed's Kashkari: My guess is we're close to neutral now

Minneapolis Fed President Neel Kashkari appeared on CNBC, offering comments that align with a soft-landing narrative for the economy but also highlighting concerns regarding the job market. He noted that inflation is gradually trending down and the job market is clearly cooling, with wage growth also on a downward trajectory. Kashkari stated, 'My expectation is low hiring but low firing,' emphasizing the risks of a potential spike in the unemployment rate. His uncertain comments about whether Powell will remain after his term add to market speculation. Market pricing indicates a greater than 50% chance of a rate cut at the March 18 meeting, with a pause in January largely priced in. There has been little market reaction to these headlines, and upcoming economic data like the ISM manufacturing survey is likely to drive trading flows as the new year begins. The overall sentiment remains cautious as traders assess the implications of Kashkari's comments and anticipate future monetary policy changes.