Fed's Barkin: I am not ready to dismiss inflation risk from tariffs

The Federal Open Market Committee (FOMC) is firmly committed to fulfilling its statutory mandate from the Congress of promoting maximum employment, stable prices, and moderate longterm interest rates. The Committee seeks to explain its monetary policy decisions to the public as clearly as possible. Such clarity facilitates well-informed decisionmaking by households and businesses, reduces economic and financial uncertainty, increases the effectiveness of monetary policy, and enhances transparency and accountability, which are essential in a democratic society. Employment, inflation, and long-term interest rates fluctuate over time in response to economic and financial disturbances. Monetary policy plays an important role in stabilizing the economy in response to these disturbances. The Committee’s primary means of adjusting the stance of monetary policy is through changes in the target range for the federal funds rate. The Committee judges that the level of the federal funds rate consistent with maximum employment and price stability over the longer run has declined relative to its historical average. Therefore, the federal funds rate is likely to be constrained by its effective lower bound more frequently than in the past. Owing in part to the proximity of interest rates to the effective lower bound, the Committee judges that downward risks to employment and inflation have increased. The Committee is prepared to use its full range of to Fed Report: Still early to assess tariff impact on economy. Fed's Monetary Policy Report Indicates Inflation Is 'Somewhat Elevated' and Job Market Remains In 'Solid Shape' Fed Report: Current Fed policy is well positioned for what lies ahead. Fed Report Indicates Deterioration In Liquidity Across Equity, Corporate Bond, And Municipal Bond Markets , But Recent Improvements Noted Despite Ongoing Sensitivity To Trade Policy News .