Fed Vice Chair Philip Jefferson said in a speech today he supported last week’s decision to keep the federal funds rate unchanged, which he views as “moderately restrictive.” He noted that the current policy setting is “well positioned” to respond to a range of evolving economic conditions.
Jefferson pointed to a sharp decline in consumer and business sentiment this year, saying he is closely monitoring “hard data” for signs of weakening economic activity.
On the inflation front, he acknowledged that higher tariffs could add upward pressure to prices in the months ahead, though it remains uncertain whether such effects would prove “temporary or persistent.”
With elevated risks to both sides of the dual mandate, Jefferson said “the current stance of monetary policy is well positioned to respond in a timely way to potential economic developments.”
