Chicago Fed President Austan Goolsbee said new tariff threats from Trump – including 50% on EU goods and 25% on iPhones made outside the US – are making monetary policy more unpredictable. While believing that interest rates will decrease in the long term, he warned that the Fed needs to be cautious due to the risk of economic stagnation. Goolsbee remains optimistic about the possibility of significant rate cuts in the next 10–16 months, but does not promise anything for the meeting on June 17–18.
=> The market should lower expectations for early action from the Fed!