Federal Reserve Governor Lisa Cook highlighted concerns over the inflationary effects of tariffs by the Trump administration during a speech in Pittsburgh on Thursday. She noted that while tariff hikes initially drive up prices for affected goods, their broader impact on inflation depends on long-term effects.
Cook pointed to rising costs in steel and aluminum, which have already pushed up manufacturing prices. This, she warned, could gradually increase costs across industries, particularly in the motor vehicle sector, affecting new and used car prices, as well as related services like rentals and insurance. Businesses, she added, are increasingly passing tariff costs onto consumers.
"It appears that the economy, for the moment, has entered a period of uncertainty. I will repeat that I believe that current monetary policy is well positioned to respond to coming economic developments," she stressed.
