FOMC Meeting Officials at the Fed have been in a communication "blackout" over the past week leading up to the meeting, but before going silent, members of the Federal Open Market Committee stated that they want to see how the economy reacts to Trump's tariffs before taking any policy actions.
Tariffs pose a double threat to the Fed's dual mandate of maintaining low inflation and high employment: not only can import taxes raise prices, but they can also harm the economy, potentially increasing unemployment. If inflation proves to be a greater threat, the Fed may keep interest rates elevated for an extended period, or alternatively, may lower rates to save the economy if the labor market begins to deteriorate.
