Federal Reserve Kashkari: Tariffs Could Lead to Uncontrolled Inflation Expectations, No More Trade Deficit Means the U.S. Is No Longer the Best Place to Invest

According to Jinshi, Federal Reserve's Kashkari (non-voting member) mentioned the economic outlook, stating that tariffs have partly caused inflation and may also lead to slower economic growth. Logically, tariffs lead to a one-time price increase, but he is concerned that, against the backdrop of already high inflation, tariffs could cause inflation expectations to become unmanageable. Kashkari said the Fed's job is to ensure tariffs do not lead to long-term inflation, and it is too early to assess what is happening right now. He also mentioned that the absence of a trade deficit means investors will have to conclude that the U.S. is no longer the best investment destination, and fluctuations in bond yields and the dollar indicate that global investors have reassessed their investment directions. Kashkari hopes that the U.S. maintains its dominant position in the global economy and the status of the dollar as the world's reserve currency.