According to a report by Jinshi Data, the head of Fidelity's $2.3 trillion fixed income business stated that Trump's trade war disrupts the economic outlook, and the Federal Reserve faces challenges in balancing inflation control and maximizing employment goals. Robin Foley noted that the Federal Reserve's efforts to combat inflation are good, but employment still needs to be monitored. She pointed out that the central bank is in a predicament.
Foley made these remarks as the Federal Reserve paused its interest rate cut cycle that began in 2024, due to the possibility that Trump's tariffs could exacerbate inflation and hurt the job market. Futures markets indicate that investors expect the Federal Reserve to resume rate cuts in September, later than initial predictions made at the beginning of the year.