Fed Collins signals lower than expected tariffs effect on inflation

Boston Fed President, Susan M. Collins, commented today to the US economy, tariff effects and AI. Here is the breakdown of his remarks.

• Strong equity markets boost household wealth and have buoyed consumption.

• It's still early days on how tariffs will play out.

• September FOMC meeting debate was data driven and analytic.

• AI will be disruptive, but it's hard to say how.

• AI is a general purpose technology with potential broad based impacts.

• Modestly or mildly restrictive stance is appropriate.

• Households are still worried about inflation pressures.

• Productivity growth might help limit tariff inflation.

• Concerns about the labor market fragility have increased.

• It's 'healthy' for Fed officials to show a range of views.

• We must be aware that long periods of high inflation can shift psychology.

• I expect tariffs to feed through but I see a smaller impact.

• Reading the economy is complicated right now.

• The Fed did not lay out preset path at September FOMC.

• Inflation risks remain and the Fed should focus on both sides of mandate.

• I expect hiring will pick up as firms adjust to tariffs.

• It may be appropriate to ease a bit further in 2025.

• Economic growth has been resilient amid a softer job market.

• Risk labor demand could ebb and push up unemployment.

• Inflation ‘elevated’ into next year, then should ease.

• I expect hiring to rebound once firms acclimate to tariffs.

• Baseline outlook is ‘relatively benign’.

• I can't rule out worse outlooks for inflation, job market.

• While inflation threat remains, upside risks to price pressures have waned.

• Modestly restrictive monetary policy appropriate due to inflation.

• Supported the recent Fed rate cut given risks to Fed mandates.