U.S. Treasury Secretary: Tariffs will not lead to sustained inflation, only a one-time price adjustment.

US Treasury Secretary Bezent spoke at the New York Economic Club on Thursday and refuted concerns that tariffs would cause inflation during a conversation with Fox Business News host Larry Kudlow. He emphasized that tariffs would only result in a one-time "price adjustment" and would not lead to long-term inflation. When asked about the inflationary effects of tariffs, Bezent responded, "Tariffs may indeed lead to a one-time price adjustment, but this is different from sustained inflation... I hope those who have wrongly predicted that inflation is 'transitory' reconsider, because if there is anything transitory, it is the one-time tariff price adjustment." He sarcastically mocked the Biden administration's previous attribution of high inflation to "transitory factors." In response to those who believe tariffs are a tax burden and will exacerbate inflation, Bezent argued, "If someone says 'tariffs are a tax, therefore an inflationary factor,' does that mean all taxes cause inflation? I am happy to pose this question to my Democratic friends." He also pointed out that the Trump administration considered the synergistic effects of overall government policies when formulating economic policies and emphasized that since Trump's election and inauguration, US mortgage rates and oil prices have both decreased, so he is not concerned about overall inflation risks. Bezent stated that the Trump administration's tariff policy aims to adjust the international economic system to "protect the interests of the American people," prevent the US from continuing to "subsidize countries with insufficient global defense spending," and avoid becoming the "ultimate buyer in global consumption" while bearing the pressure of supply-demand imbalances in other countries' economic models. "The acquisition of cheap goods is not the essence of the 'American Dream,'" Bezent emphasized. "The core of the American Dream is that every citizen can achieve prosperity, social mobility, and economic security." Bezent also stated that tariffs will provide the US with an opportunity to reevaluate multilateral trade agreements and international economic relations to ensure they truly serve the interests of the American people. He believes that the current international trade system has numerous flaws, and the goal of tariffs is to "create a fair competitive environment that rewards innovation, security, rule of law, and stability, rather than low wages, currency manipulation, intellectual property theft, non-tariff barriers, and harsh regulatory policies."