Fed's Musalem warns tariffs could have 'significant' impact on economy despite China trade truce

Contributing sentiments towards policy:

52% : If trade negotiations do not soon permanently reduce tariffs and retaliation, and inflation moves higher while the job market softens, Musalem sees two possible scenarios for monetary policy depending on how long-lasting inflation turns out.
46% : Yet Musalem noted that he believes central bank monetary policy is "currently well positioned" to respond to the impact of changes in trade policy, immigration, tax policy and deregulation.
40% : " Many central bank policymakers have been warning about higher inflation, elevated unemployment, and slower economic growth this year due to tariffs imposed by Trump, who has kept tariff rates at 10% for most countries while his team negotiates custom trade deals for some of America's largest trading partners.
37% : The White House has argued that the Fed should view any increases as a one-time event, with Trump himself repeatedly calling for the Fed to lower rates, but many Fed officials have made it clear they are not sure which way things will go.

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