Just when crypto markets were hoping the rate-cutting era might finally arrive, one of the Federal Reserve’s most vocal inflation hawks is pushing in the opposite direction.
Minneapolis Fed President Neel Kashkari told CNBC on May 28 that the central bank may need to raise interest rates to combat broad inflation, citing growing risks from energy prices and persistent price pressures across the economy.
The inflation numbers tell the story
April 2026 CPI data came in hotter than anyone wanted, with a headline rate of 3.8% and core prices climbing 0.4% month-over-month. That core figure overshot both the prior reading of 0.2% and the consensus expectation of 0.3%.
Following the CPI report, traders priced in Fed rate hikes at over 35% probability for the remainder of 2026. That’s a meaningful shift from a market that, not long ago, was betting on cuts.
