Hello,
If there's one thing the Trump Administration wants when it comes to the economy, its for the Federal Reserve to cut interest rates. Fed Chair Jerome Powell made it clear that he's not quite ready to do that yet.
Inflation rates have been relatively stable in the United States, as the effect of tariffs has not filtered through to major price increases yet. The drumbeat for the Fed to cut rates has grown among administration officials – raising fears about interference in the central bank's policymaking processes. While several members of the committee also sounded more likely to support rate cuts in recent days, Powell does not.
In Congressional testimony, Powell said that the outlook is still for higher inflation. "All professional forecasters I know of ... expect a meaningful increase in inflation over the course of this year," Powell said, as a way of elaborating on why the Fed has been reluctant to cut rates during a period of trade policy uncertainty.
In recent days two Fed governors appointed by Trump have said rates could fall as soon as the July meeting, while two reserve bank presidents are still worried that inflation will intensify through the rest of 2025.
Sellers of canned fruit and other goods are feeling the pinch of steel and aluminum tariffs in the United States – hitting the likes of Andy Russick, who said "we're getting caught up in that brush fire."
German car parts supplier Continental cut its profitability targets for its tire business in part due to tariff barriers.
And Canada's Prime Minister Mark Carney said the nation has a chance to strike a new defense and economic relationship, though nothing is assured.
Read the latest tariff headlines below. If you like this newsletter or have suggestions on how we can make it better, send me an email to david.gaffen@thomsonreuters.com.
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