TARIFFS: Guardian: 50% Tariff On Steel Still Included In EU-US Agreement

• Q: You referred to policy being close to neutral. Are you close to the top of the SEP range (the policy rate is about 50bps above the top end) or do you have a shorter-term neutral rate in mind?
• Hammack (’26 voter): You do correctly read that I’m towards the top of that range. So yes, that's why I think we are pretty close to neutral.

"GERMAN CHANCELLOR BACKS MORE MUSCULAR APPROACH AHEAD OF JULY TALKS DEADLINE - FT
EU READIES RETALIATORY TARIFFS TO SECURE BETTER TRADE DEAL WITH TRUMP - FT" - Reuters

• Full FT article found here: https://www.ft.com/content/3d336a84-ac59-45ee-b857-8a01fc7cd806
• "The EU must make a “credible threat” of retaliation in Donald Trump’s trade war if it wants to get a good deal, a senior official has warned ahead of a looming talks deadline.
• "Bjoern Seibert, the European Commission president’s chief of staff, told the bloc’s ambassadors after the G7 summit in Canada last week that the prospect of a strong response would help convince the US president to reduce stiff tariffs on the EU, according to two EU officials."

us dataCleveland Fed’s Hammack (’26 voter) has a similar view to Fed Chair Powell on the labor data, with it reasonably stable but some weariness that it can turn quickly. US immigration policy could be a barrier to longer-term growth which is something to be watched. 

• “The shift in immigration policy could have a material impact in terms of how we're interpreting [labor] data. So if you look at sort of the breakeven payrolls number that we had needed last year would have been significantly higher than what we'll need this year. We factor that in as we're looking at the weekly claims data and other numbers.”
• “The tricky thing with the labor market is that when it tends to weaken, it tends to weaken quickly. And so you have to be very attentive to it. You have to be watching it carefully as I am for those signs.”
• “Right now we've had very good stability in the employment side.”
• “When I'm out in the district talking with businesses, whether I'm in Toledo or Worcester or Pittsburgh or all the great cities that we have in the Midwest, what I get is really a sense from business leaders that they worked incredibly hard to find and train workers over the past several years coming out of the pandemic, and they're very loathe to let them go. And so we are in this slow hiring, slow firing world, where you're not seeing a lot of layoffs, but if you don't have a job, it's much harder to get a job.”
• “The VU ratio is one that we continue to track closely, and we're still running right around our pre pandemic number. It's come down very significantly from where we had been in the pandemic. But I don't see the labor market as being a source of inflation for the US economy right now. And based on the data that I'm seeing right now, it looks like our labor picture is reasonably stable, partly because of the immigration implications.”
• “It could be a barrier to growth longer term. So that's something that we do need to watch, because if growth weakens, and you could see follow on implications for the labor market as well, but, right now, I think the labor market looks reasonably stable and very healthy in the US.”