Stephen Milan, the newly appointed member of the FED by Trump, made remarkable assessments regarding monetary policy and the economic outlook.
Milan noted that current monetary policy is quite tight, adding, “The longer the restrictions last, the greater the risks.”
Regarding the recent tariffs, Milan argued that they do not create inflationary pressures. “The long-term effects of tariffs are incomparable to the current environment,” he said. “People will eventually see that tariffs do not increase inflation.” He also argued that the decrease in immigration also has a depressing effect on inflation.
Milan, who attributed the economic slowdown in the first half of the year to uncertainties, noted that these uncertainties have largely disappeared. “We must encourage supply-side growth,” Milan said, adding that interest rate cuts would continue in the coming months. “We are in a loosening cycle,” he said. “I will try to persuade other policymakers to cut interest rates more rapidly.”
Meanwhile, former US President Donald Trump once again targeted the Fed administration. He called Fed Chair Jerome Powell a “bad president” and criticized the Fed for “doing more.” Trump also predicted a government shutdown due to the spending bill.
*This is not investment advice.