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MNI PODCAST: FedSpeak-Carpenter Sees Little Room For 2025 Cuts

MNI interviews the former deputy of Fed board's division of monetary affairs.
USCentral Bank NewsFederal ReserveStoryNorth America
MNI (WASHINGTON)

EXECUTIVE SUMMARY

  • Seth Carpenter, former deputy director the Fed board's division of monetary affairs, thinks the central bank will barely be able to squeeze in another rate cut this year if at all before tariffs boost inflation for a while, leaving policymakers on hold until well into 2026.
  • By then, the growth drag of the tariff war will be more palpable, and officials will again be considering rate reductions, said the Morgan Stanley global chief economist.
  • Carpenter thinks investors are overhyping the stimulus boost from any extension of existing tax cuts and underestimating the fiscal drag from wide-ranging federal government cuts. 

Listen to the full podcast here.

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MNI (WASHINGTON)

EXECUTIVE SUMMARY

  • Seth Carpenter, former deputy director the Fed board's division of monetary affairs, thinks the central bank will barely be able to squeeze in another rate cut this year if at all before tariffs boost inflation for a while, leaving policymakers on hold until well into 2026.
  • By then, the growth drag of the tariff war will be more palpable, and officials will again be considering rate reductions, said the Morgan Stanley global chief economist.
  • Carpenter thinks investors are overhyping the stimulus boost from any extension of existing tax cuts and underestimating the fiscal drag from wide-ranging federal government cuts. 

Listen to the full podcast here.