Federal Reserve Vice Chair Jefferson: Paying attention to the risk of policy pushing up prices, downplaying the impact of Moody's downgrade.

Amid the backdrop of profound adjustments in current U.S. trade and regulatory policies, Vice Chair Jefferson of the Federal Reserve stated that the Fed must ensure that the price increases triggered by Washington's policy changes do not evolve into sustained inflation. Speaking at the 2025 Atlanta Fed Financial Markets Conference in Fernandina Beach, Florida on Monday, Jefferson pointed out, "I think one of the key tasks of monetary policy is to ensure that any rise in price levels does not sustained inflationary pressures." Currently, President Trump has implemented extensive new tariff measures against several trading partners and has proposed and pushed for a series of reforms in immigration and regulatory policies. Economists widely expect that these policies may increase inflation levels and have a certain restraining effect on economic growth, although there is still a high level of uncertainty regarding the final extent of the tariffs and their specific impact on the economy. Jefferson stated that in the current highly uncertain situation, "adopting a wait-and-see strategy is an appropriate approach, we need to wait for policies to gradually take effect and observe their actual impact on the economy." Despite facing a changing policy landscape, the Federal Reserve has maintained the benchmark interest rate unchanged since 2025, due to the lack of urgent signals to adjust the rate in the current stable economic fundamentals. Fed officials have consistently emphasized in policy-making the need to ensure that the public's long-term inflation expectations remain stable. In his remarks on that day, Jefferson reiterated this stance, stating that the current monetary policy is in "a very good place" and still has a "moderately restrictive" effect on the economy. "We will ensure that monetary policy continues to anchor expectations, while patiently waiting for the comprehensive impact of various policies to unfold." When asked whether Moody's downgrade of U.S. credit rating last Friday would affect the Fed's policy direction, Jefferson responded that this decision would not change the Fed's responsibilities and stance. "We will treat this downgrade like any other external information. It will not change our responsibilities or our policy logic."