(Reuters) -Minneapolis Federal Reserve President Neel Kashkari said on Monday it was a "close call" on whether he would vote to raise interest rates at the central bank's meeting next month or take a pause and leave rates where they are.
Speaking on CNBC, Kashkari also said services inflation remains "pretty darn entrenched" and that "it may be that we have to go north of 6%" to get it back to the Fed's 2% target.
The Fed raised interest rates for a 10th straight meeting earlier this month, lifting its benchmark overnight rate to a range of 5% to 5.25%.
Officials in their accompanying policy statement opened the door to pausing further hikes while they assess how inflation is responding and to see to what extent the recent banking system stress might add to the tightening of conditions engineered by the Fed.
Kashkari, a 2023 voting member of the rate-setting Federal Open Market Committee who has emerged in the last year as one of the most hawkish policymakers, said he is seeing little evidence yet in his district that the banking system ructions triggered by the collapse in March of Silicon Valley Bank has had demonstrable impact on the availability of credit.
In an essay published on Monday, Kashkari - who served as head of the Troubled Asset Relief Program during the 2007-2009 financial crisis - reiterated his call for regulators to impose more stringent capital requirements on U.S. banks.
If SVB and the other banks that recently collapsed had "had significantly more equity capital, their depositors would have been reassured because the banks could have absorbed their market-to-market losses," Kashkari wrote.
(Reporting By Dan Burns; Editing by Toby Chopra and Nick Macfie)
