Federal Reserve Bank of Boston President Susan Collins:
- Cautiously, realistically optimistic about the economy.
- Economy started 2025 in a good place.
- Inflation had come down but was still elevated at the start of the year.
- The outlook now is much cloudier for inflation and growth.
- Inevitable tariffs will increase inflation in the near term.
- It remains a question how long tariff-driven inflation will last.
- Inflation risks are on the upside.
- Strongly supported the Fed’s decision to hold rates steady.
- Expects the Fed will likely hold rates steady for longer given the outlook.
- Federal layoffs still small relative to aggregate size of labor market
- Economic uncertainty causes businesses to pull back
Headlines from Barkin a few minutes ago:
Collins sounding more hawkish than Barkin! Check these out:
- Inevitable tariffs will increase inflation in the near term.
- Inflation risks are on the upside.
Hedged a little with:
- It remains a question how long tariff-driven inflation will last.
On this, a rise in tariffs is likely to cause a one-off rise in inflation. Ongoping tariff increases though would be a different story, if it comes to that.
This article was written by Eamonn Sheridan at www.forexlive.com.