Raphael Bostic, President of the Federal Reserve Bank of Atlanta, has revised his interest rate forecasts, noting the impact of tariffs on inflation.
Changes in Fed Rate Forecast
Bostic now anticipates just one rate cut in 2025. He attributes this to tariffs extending inflation. He expects inflation to hit the 2% target by early 2027, later than the Fed's previous September forecast.
Trump Increases Pressure on Fed
While Bostic is holding off, Donald Trump is not. He continues to push for rate cuts, arguing rapid action is needed to mitigate the impact of his planned tariffs.
Bostic Warns of Inflation and Rate Issues
Bostic warns that inflation will remain challenging and rates will stay high longer. He emphasizes tariffs’ potential to exacerbate inflation in the current climate.
The impact of tariffs and inflation expectations continue to shape Fed policy. Despite pressures, Fed officials remain cautious in their approach.
