Fed officials seek patience of rate decisions in tariff conditions

Atlanta Federal Reserve President Rafael Bostic warned on Thursday that he believes tariffs are likely to cause extended part of the inflation Against the one -time jump in costs.

Instead of “short and simple one -off price changes, as standard textbook models would suggest,” Bostic said he expects changes to US trade policy, along with concomitant geopolitical events to lead to a “longer period of elevated inflation” over a year or more.

In conditions of increasing pressure from the president Donald Trump On the Fed to loosen the position of monetary policy, Bostic has firmly backed the comments of Federal Reserve President Jererom Powell on Tuesday that the central bank should wait to adjust the position of politics because it continues to follow as tariffs can affect prices.

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Bostic, who is not a member of the Federal Open Market Voting Committee to determine the Central Bank rate (FOMC), said the current period marked by economic uncertainty is “there is no time for significant changes in monetary policy”.

The next meeting of FOMC is July 29-30. Trump’s 90-day break on the convincing “reciprocal tariffs” that he announced on April 2 is scheduled to expire on July 9. Finance Secretary Scott Besen told “Morning with Mary” “Morning with Mary” on Thursday that he expects “multitude of deals” to be announced before next week’s deadline.

Inflation readings of March, April and May 2025 have shown inflation levels that drift slightly above 2% target of the Fed, which Bostic said the tariffs “were not significantly affecting consumer prices”. However, Bostic said he believes pink data in recent months reflects the “strategies of firms to delay essential prices” until the final tariffs are determined, rather than proof that the economy has prevented prices for tariff prices.

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The Fed Atlanta chief’s comments for a lecture in Frankfurt, Germany, came hours after Thursday Unemployment Report in June It showed that employment for the month exceeded expectations, with the economy adding 147,000 jobs and the unemployment rate that dropped to 4.1%.

The Fed has had stable interest rates since December 2024, when the central bank cut its target by a quarter of the percentage point in the middle of what seemed to be the market as a cycle of reducing the rate to continue.

Powell said on Tuesday That he believes that the Fed will continue to lower interest rates if no tariffs were carried out, adding that “we went to rest when we saw the size of the tariffs.”

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Bostic’s calls for patience for monetary policy movements reiterated the Federal Reserve of Richmond, Tom Barkin on the position of the Central Bank on Wednesday.

In an interview with Fox Business “Klein Countdown”, Barkin compared the Fed’s efforts to reveal the impact of tariffs on the economy to “fog driving”, a metaphor he used since March to describe the difficulty FOMC facing.

“You do not know what the impact of politics on the economy is,” Barkin said. “And as long as there is no urgency from the larger environment, I think someone does what he does when driving through the fog, which goes slowly.”