Lisa Cook, governor of the Federal Reserve, speaks on March 22, 2024 during a Fed listener event in Washington, DC.
Al Drago | Bloomberg | Getty pictures
The governor of the Federal Reserve, Lisa Cook, commented on Tuesday about the progress of inflation and said that the latest lower readings could turn back after the tariffs could have worked through the economy.
In addition, Cook expects that she would expect President Donald Trump's trade policy to anesthetize the labor market, although she found that the economy is initially in relatively good shape.
“I have no views of the policy of the administration. But I am investigating the economic implications that seem to increase the likelihood of higher inflation and cooling of the labor market,” said the political decision -maker in a speech before the council about foreign relations in New York.
In inflation, Cook found that progress was made with a core inflation of 2.5% and a heading of 2.1% in April, as can be seen from a report last week in which the preferred measure of the Fed is used.
However, economists mainly expect the tariffs to increase the costs higher. Fed civil servants generally consider the tariffs as a unique occurrence for prices, but the wide range of Trump taxes could change the equation.
“The price increases bound with changes to the trade policy can make it difficult to make further progress at short notice,” said Cook. “The latest post -pandemical experience with high inflation could make companies more increasing prices, and consumers expect a high level of inflation more often.”
In fact, a survey -based level of inflation refers to a significant increase in the next year. However, market -based measures continue to show steamed expectations.
Cook's comments come two weeks before the next political meeting of the Fed on June 17th to 18th. The market expectations show that the central bank in relation to interest rates and most of the statements by the political decision -makers have been going back to hold since the last meeting. Traders expect the next Fed cut in September.
Cook has not stated when it believes that the Fed can loosen again and said that the current guideline was defined in a place where she and her colleagues can react to threats on both sides of the Fed mandate for full employment and low inflation.
“I see the US economy as still in a solid position, but increased uncertainty carries risks for both price stability and unemployment,” she said. “When making decisions, it is valuable to remain a student in economic history. Our recent past has delivered some useful lessons for decision -making in times of high uncertainty and increased risk for our double altitude.”
The President of Atlanta, President Raphael Bostic, said earlier a day [inflation] The measures still flash red. “
In a speech over the weekend, however, Fed Governor Christopher Waller said that he expects the tariffs to be at the bottom of the expectations, whereby the effects in the second half of the year could still enable the FED to issue “good news” downs before the end of 2025.