Donald Trump’s tariffs have opened a schism at the Federal Reserve as top policymakers spar over whether to cut interest rates as soon as this summer or hold them steady for the remainder of 2025.
Christopher Waller, a Fed governor seen as a candidate to replace Jay Powell as its next chair, on Friday called for a rate cut as soon as next month and played down the risks that US president’s levies would push up inflation.
“We’ve been on pause for six months thinking that there was going to be a big tariff shock to inflation. We haven’t seen it,” Waller, who became a Fed governor in 2020 after Trump nominated him to the post during his first term, said in a CNBC interview.