FED Governor Christopher Waller believes that the inflation impact from the tariffs proposed by President Trump will only be "temporary"; he reused 2 terms that previously drew much criticism for the Fed during the inflation wave of 2021–2022.

"I can imagine the objections that will arise, arguing that this is a mistake because of what happened in 2021 and 2022... But just because it was wrong once doesn't mean we shouldn't continue to consider that direction."

Two scenarios could occur:

In the case of large and prolonged tariffs, he predicts inflation will rise sharply in the short term, potentially reaching 4%–5% before cooling down as growth slows and unemployment rises.

In the scenario with smaller tariffs, inflation could rise to about 3% and then gradually decrease.

In both cases, Governor Waller stated that the Fed is still likely to cut interest rates, only differing in timing. Large tariffs may force the Fed to cut early to support growth, while smaller tariffs may allow for a cut later this year.