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Federal Reserve Watch for Aug. 13: Impact of Tariffs Beginning to be Seen in Inflation Data

BY MT Newswires | ECONOMIC | 08/13/25 02:48 PM EDT

02:48 PM EDT, 08/13/2025 (MT Newswires) -- Atlanta Fed President Raphael Bostic (nonvoter) noted the weakness seen in the July employment data and said that lower-income consumers and small businesses are beginning to feel the impact of tariffs.

Chicago Fed President Austan Goolsbee (voter) said that tariffs-related price pressures have begun to be seen in the available data and that the effects may not be transitory.

Recent comments of note:

(Aug. 12) Kansas City Fed President Jeffrey Schmid (voter) said that interest rates should not be lowered right now with the economy still strong and inflation above the Fed's target. He conceded that effects of tariffs on inflation are expected to be modest and that he would alter his views on monetary policy if conditions begin to deteriorate.

(Aug. 12) Richmond Fed President Tom Barkin (nonvoter) said that monetary policy is well positioned to adjust monetary policy if needed but said the balance between upward pressure on inflation and upward pressure on unemployment is still unclear and that inflation growth will depend on how consumers react to higher prices that result from tariffs.

(Aug. 12) President Donald Trump, in addition to demanding that the Federal Open Market Committee begin to cuts interest rates, said that he is considering allowing a "major" lawsuit to move forward against the Fed regarding the costs of renovations to the Fed's headquarters.

(Aug. 9) Fed Vice Chair for Supervision Michelle Bowman said that the weaker-than-expected July employment data bolster the case for three rate cuts this year, suggesting that labor demand has softened considerably from earlier in the year, in line with her expectations.

(Aug. 8) St. Louis Fed President Alberto Musalem (voter) said that above-target inflation and the slowing labor market are both risks to the US economic and that policy makers need to decide which is the bigger problem and by how much when charting the path for monetary policy. Musalem said that it is likely that the impact of tariffs on inflation will only be short-term but noted there is a chance that they could have a more lasting effect.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.

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