MNI BRIEF:Fed Restrictive, Good Position For Tariffs-Jefferson

Federal Reserve Vice Chair Philip Jefferson said Wednesday interest rates are "well positioned to respond in a timely way to potential economic developments" such as the fallout of global tariffs, echoing the view of Chair Jerome Powell and others.

President Donald Trump's actions could lead to higher inflation and hold down economic activity, adding risks to both sides of the Fed's dual mandate, Jefferson said in remarks prepared for a New York Fed conference. Jefferson has revised down his forecast for growth this year.

"Whether tariffs create persistent upward pressure on inflation will depend on how trade policy is implemented, the pass-through to consumer prices, the reaction of supply chains, and the performance of the economy," he said. "I view the current stance of policy as well positioned to respond to developments that may arise." (See: MNI INTERVIEW: Fed Could Hold Rates For Some Time-Kaplan)