Overview

• Adriana Kugler said disinflation has slowed and that higher tariffs are already lifting prices, leading her to advocate for a moderately restrictive policy stance.
• Jeff Schmid said he would be uncomfortable relying on theory that tariff-driven price increases are temporary, indicating rates may remain unchanged beyond June’s meeting.
• Both officials cited a reversal in core goods inflation and an uptick in short-term inflation expectations based on University of Michigan survey data.
• The Fed is monitoring private high-frequency indicators such as PMI readings and layoff reports to track economic trends in real time.
• Views remain split among FOMC members, with some forecasting only a one-off tariff shock and others warning of more persistent inflationary effects.