Federal Reserve Bank of St. Louis President Alberto Musalem revealed on Wednesday that the labor market is currently "at or close to full employment."
Musalem noted the heightened risk of inflation remaining above the Fed’s 2% goal due to tariff changes and other factors, stressing the need for inflation expectations to stay stable. He reassured the public that he does not see recession on the horizon but continued to warn that secondary effects may compel officials to keep interest rates steady for longer.
"I would be wary of assuming that the impact of tariff increases on inflation will be entirely temporary," the banker said, urging vigilance about indirect and second-round effects during an event in Paducah, Kentucky.
