Despite President Donald Trump’s public efforts to cajole the Federal Reserve into lowering interest rates, monetary policy is rightly locked on hold over the near-term for three reasons.
First, the uncertainty surrounding the Trump administration’s tariff regime remains unusually high. Not only is tariff policy ever-changing in terms of countries, products, rates and rationale, but also the timeline for resolution continues to be pushed back, as evidenced by the April 1 and July 9 deadlines that have come and gone. Attention is now on the August 1 deadline, which is two days after the central bank next meets to set monetary policy.
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Bloomberg Opinion