NY Fed's Williams Says Trump Tariffs May Have Added Up To 75 Bps To Inflation, But Sees Room For A Further Cut

John Williams, President of the Federal Reserve Bank of New York, on Friday stated that President Donald Trump’s tariffs have contributed about 50 to 75 basis points to inflation.

In prepared remarks at the Central Bank of Chile Centennial Conference, Santiago, Chile, Williams stated that it’s not possible to measure the impact of trade policy actions on inflation with precision. However, he did attribute some of the current inflation to the Trump administration’s tariffs.

“My estimate is that increased tariffs have contributed about one half to three quarters of a percentage point to the current inflation rate. I do not see any signs of tariffs contributing to second-round or other spillover effects on inflation,” Williams said.

He stated that the current monetary policy of the Federal Reserve is “modestly restrictive,” and that he sees some room for further adjustment following the 25 bps rate cuts in September and October.

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