On Monday, Austan Goolsbee, President of the Chicago Federal Reserve Bank, expressed his belief that the Fed would eventually lower short-term rates once the uncertainty surrounding tariff policies is resolved.
Key Quotes
- So far we’ve had excellent inflation reports and, surprisingly, little direct impact of tariffs.
- Don’t know if that will remain true in the next 1-2 months.
- Still think underneath all the tariff ‘dirt in the air’, rates can come down over 12-18 months.
- Still think if we can get past this bumpy period, the dual mandate looks pretty good.
- A little gun-shy about arguing that tariffs will have a transitory effect on inflation.
- Recent PCE inflation print may have been the ‘last vestige’ of the pre-tariff impact.