"Miran told the Economics Club of New York that rates should be below 3% by the end of the year, and dismissed fears that the US president's tariffs were stoking inflation. Relatively small changes in some good prices have led to what I view as unreasonable levels of concern, Miran said, adding that tariffs would ultimately lead to substantial swings in net national savings for the country."
"Higher tariffs have begun to push up prices in some categories of good, but their overall effects on economic activity and inflation remain to be seen, Powell said. While it seems like inflation from tariffs may be relatively short-lived, a one-time shift in the price level, inflation could be more persistent. That is a risk to be assessed and managed, Powell said."
"Much inflation is from rising costs in the housing market, including the rental market, which he said will see a cooling off as the US's population decreases amid Trump's immigration policies. Economic data appears to be more in line with Powell's analysis. Since April, inflation measured by the consumer price index has gone up 0.6% from 2.3% to 2.9%. For years, the Fed has set its target inflation rate at 2%, a rate which has not been seen since 2021."
Stephen Miran cast the sole dissenting vote against a quarter-point Fed rate cut, preferring a half-point reduction and urging rates under 3% by year-end. He downplayed tariff-driven inflation, arguing small price changes have been overemphasized and that exporting sellers will lower prices. Miran attributed much inflation to housing and rental cost increases and predicted cooling as the US population slows amid immigration policy shifts. Jerome Powell offered a contrasting assessment, warning tariffs have begun to raise some prices and could produce more persistent inflation risks. Recent CPI climbed from 2.3% to 2.9% since April, above the 2% Fed target.
Read at www.theguardian.com
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