On April 4th, in an important speech on monetary policy direction, Philip
Jefferson, Vice Chairman of the U.S. Federal Reserve (Fed), stated that he did
not see the need to rush into adjusting interest rates at this time. According
to him, the U.S. economy is stable, with key growth indicators continuing to
remain positive, despite increased pressures from goods inflation—largely
driven by the tariff policies that are being pushed forward.
Jefferson emphasized that the new tariffs have increased the cost of imported
goods, thereby putting pressure on domestic consumer prices. However, he also
noted that the current economic outlook is facing more uncertainties than
before, including risks from fluctuating trade policies, global geopolitical
conditions, and the uncertain developments in the labor market.
In light of these factors, Jefferson believes that monetary policy should
remain at a 'moderately tight' stance, as it is currently, in order to balance
the goals of controlling inflation and maintaining job growth.
'In my view, there is no urgent reason to adjust interest rates at this time.
What is important is that we need to be patient and monitor additional data on
inflation and the labor market in the coming period,' he stated.
The Vice Chairman also reiterated a traditional view of U.S. central bank
officials that the current policy stance is well-positioned to respond
flexibly to risks and uncertainties in the process of achieving the Fed's dual
mandate: ensuring price stability and promoting maximum employment.
Meanwhile, investors are deeply concerned about the impact of the new tariff
policy recently announced by the U.S. On April 2nd, President Donald Trump
unexpectedly declared tariffs on all of the country's trade partners, with
rates ranging from 10% to 50%. Trump asserted that this was an important step
to protect the U.S. economy.
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