S&P 500 falls on pressure from retail stocks, weak jobless claims
Investing.com -- Tom Barkin, President and CEO of the Federal Reserve Bank of Richmond, shared his views on inflation, employment, and rate cuts in an interview on CNBC today.
Barkin acknowledged that it will take some time before the impact of tariffs can be fully understood. He noted that suppliers are feeling confident and have indicated that they will have to pass on higher prices due to these tariffs. This comes as consumers express their dissatisfaction with paying higher prices.
Barkin voiced his skepticism about whether these higher prices won’t eventually be passed on to consumers, leading to inflation. He stated that in order to consider cutting rates, there needs to be confidence about inflation. However, he suggested that higher inflation numbers might make rate cuts less probable.
Barkin recalled the 1970s stagflation period, characterized by high inflation expectations, and clarified that we are not currently seeing a similar situation. He described the current economic data as acceptable but pointed out that there are risks associated with employment.
When asked about his plans for rate cuts this year, Barkin chose not to provide a specific number. He expressed his concerns about inflation and employment, and stated that he is not in a rush to cut rates. He suggested adopting a ’wait and see’ approach.
Lastly, Barkin touched upon the balance sheet run off, indicating that it could be slower and last longer than initially expected.
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