📉 A rate cut is still an option despite inflationary pressures.
In a notable statement, Federal Reserve member Christopher Waller confirmed that the option to cut interest rates is still on the table during the second half of 2025, despite ongoing inflationary pressures resulting from recent trade policies.
🔥 Do tariffs hinder monetary easing plans?
Waller noted that the tariffs imposed by the Trump administration may contribute to a temporary rise in inflation, but he emphasized that the impact of these tariffs should not be a decisive factor in shaping monetary policy and should be 'overcome' when making decisions about interest rates.
☄️ The most important thing Christopher Waller said:
He believes that the impact of tariffs on inflation is temporary and should not prevent the Fed from moving towards easing monetary policy.
If inflation continues to decline towards the target set at 2%, and the labor market remains strong, conditions will be favorable for a rate cut later this year.
He confirmed that the U.S. economy still enjoys strong momentum, giving policymakers more time to monitor developments in global trade.
He warned that escalating trade measures could harm growth by reducing spending, production, and employment in the second half of the year.
⚡️ The question everyone is asking:
Will the Federal Reserve be able to cut rates soon?
Or will inflation remain the main obstacle to any move towards monetary easing?