WASHINGTON (Reuters) -The Federal Reserve should intervene in markets only reluctantly and in a true emergency, Minneapolis Fed President Neel Kashkari said on Friday in the most explicit comments yet from a Fed official about the possibility of the central bank stepping in to tame volatility that has torn across asset classes in response to President Donald Trump's tariff policies.

"The Fed or Treasury stepping in should be done reluctantly, should be done when it is only truly needed," said Kashkari, who as a Treasury official during the 2007 to 2009 crisis led the Troubled Asset Relief Program. "I think we should be very cautious about taking moves that could demonstrate a weakening, which I don't think is there, to the Fed's commitment to getting inflation down."

So far, he said, markets seemed to be functioning smoothly, which is the Fed's overriding concern. Since Trump tariff announcements last week U.S. stock prices have cratered and Treasury yields have risen at the same time, a potentially worrisome sign of investors turning from the U.S. more broadly.

More typically in times of stress U.S. yields fall as investors seek a safe place to park cash.

In a wideranging interview on CNBC, Kashkari said recent market developments may show investors changing their view of the U.S.

"There's a lot of complexity," he said. Along with yields rising "the dollar has been weakening. Normally when you see big tariff increases I would have expected the dollar to go up. The fact that the dollar is going down at the same time, I think, lends some more credibility to the story of investor preferences shifting."