New York Fed President: Trump tariffs will boost U.S. inflation

John Williams, president of the Federal Reserve Bank of New York, has warned that the Trump administration's tariff policies could lead to inflation.
Williams spoke at the Bloomberg Invest Conference held in New York on the 4th (local time).
"Based on the information we currently have, we expect the tariffs to have an impact on prices and inflation going forward," he said in a statement. "We expect these effects to be felt by the end of the year."
He went on to say there is a lot of uncertainty about how tariffs will affect economic activity, business investment and consumer spending, and that "we're going to be watching closely how the Fed responds to this."
"We are considering it," he said, adding that the current interest rate policy is at an appropriate level and there is no immediate need to adjust interest rates.
Williams, who is in charge of the New York Fed's open market operations, is the current F.
It assessed the Fed's policy as "moderately contractionary" and predicted that inflation would stabilize at the Fed's 2% target over time.
The Fed has frozen interest rates until January of this year after lowering them by 1 percentage point at the end of last year.
The Fed has indicated that it will maintain interest rates until it sees further evidence of its price stability target (2%). Earlier, Chairman Powell said the U.S. economy remains strong,
Williams said there was no need to rush to lower interest rates. He also said that when tariffs were imposed on some products during Trump's first term in 2018, companies had to pay back the increased costs.
However, he also noted that companies have become more adept at raising prices and that consumers are more sensitive to price changes.
"We're watching inflation expectations very closely," he said. "While the tariff debate is changing consumer perceptions of near-term price increases, it's important to keep longer-term inflation expectations in check."
"It doesn't seem like it's going to shake things up much," he said. As the impact of the Trump administration's tariffs on inflation and economic growth becomes more visible, markets are warming to the Fed's upcoming interest rate decision.
The Federal Reserve will hold a Federal Open Market Committee (FOMC) meeting on the 18th and 19th to decide whether to adjust monetary policy.