Fed Official Highlights Risks of Increased Tariffs

During a recent presentation at the Peterson Institute for International Economics, Dallas Federal Reserve President Lorie Logan voiced concerns over the potential economic impacts of heightened tariff levels. "Increased tariffs could lead to higher unemployment and inflation," Logan cautioned, underscoring the delicate balance required to sustain economic stability.

Monetary Policy and Inflation Control

Logan emphasized the importance of maintaining current monetary policies to prevent tariff-related price hikes from fueling persistent inflation. "The stance of monetary policy is well positioned at this moment," she stated, highlighting the critical role of policy in anchoring long-term inflation expectations.

Challenges of Entrenched Inflation

The Fed official also pointed out the difficulties in reducing inflation once expectations become entrenched, warning of worsened employment conditions and intensified economic damage. This scenario underscores the need for vigilant economic monitoring and policy adjustment.