According to BlockBeats, on January 8, the Trump administration’s aggressive tariff policy may lead to further inflation, but economic models show that this will be a one-time increase in price levels rather than a long-term inflationary spiral.
Wells Fargo economist Jay Bryson said this could convince the Fed to be more patient in dealing with tariff-induced inflation, especially if the labor market continues to slow. His view supports Wells Fargo's baseline forecast that the Fed will cut interest rates three more times this year, each by 25 basis points. But Bryson warned that if the trade war becomes more protracted, such as a series of tit-for-tat international retaliation, the Fed may have to take the inflationary consequences more seriously. (Jinshi)