The vice president of the Fed, Jefferson, advocates to remain cautious on the rates as the political drama develops

Easton, Pa. – Federal Reserve Vice President Philip Jefferson said Tuesday that the Central Bank must be careful how interest rates in the midst of an uncertain policy environment.

In general terms, the governor of the Fed said that he sees the strong economy with the inflation that becomes a “potholed” road to the 2% target of the central bank and a labor market in a “solid position.”

However, Jefferson echoed recent statements from other officials that it is in the best interest of the Fed to move slowly while evaluating the conditions of evolution.

“While the economy and labor market remain strong, I see it as appropriate for the Committee (of the Federal Open Market) to make more adjustments,” he said in comments for a speech at Lafayette College.

“In the medium term, I still see a gradual reduction at the level of monetary policy restriction that is imposed on the economy as we move towards a more neutral posture as the most likely result,” Jefferson added. “That said, I don’t think we should be in a hurry to change our position.”

The comments arrive less than a week after the FOMC voted Maintain your stable policy rate In a range between 4.25% and 4.5%, a decision with which Jefferson agreed. In the previous three meetings, the committee had reduced the rate of federal funds by a total of 1 percentage point after walking quickly to combat an increase in inflation.

Fed officials have refrained from commenting directly on policy confrontations in Washington, but have expressed a level of fear about trying to prejudge the events.

The main between the current level of uncertainty is the impact that tariff negotiations will have between the United States and their main commercial partners. President Donald Trump It has stopped in tasks against products from Canada and MexicoBut he is locked in a tense battle with China.

“There is always great uncertainty about any economic prognosis, and we currently face additional uncertainties about the exact form of government policies, as well as their economic implications,” said Jefferson.

During the past year, the Fed Favorted Inflation Meter – The Personal Consumer Expenses Price Index – He has embroidered lower. The rate increased 2.6% in December in a year after year, accommodating its peak but still ahead of the 2% goal of the Central Bank.

Jefferson said he expects inflation to continue going down, but covered his perspective.

“In the current environment, I attach a high degree of uncertainty to my projections,” he said.

The policy manufacturer added that “it could imagine a variety of scenarios for a future policy” where “we can maintain the restriction of policies for longer” if inflation remains high, or one where the Fed could relieve more if the labor market weakens .