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…The wrinkle in the effort is the #DebtCeiling, which limits how much the government can borrow. Faced with this roadblock, the #Treasury is using cash from its account at the #Fed to pay bills, which is adding liquidity into the system. When the #debt ceiling is raised, assuming that happens, the Treasury will likely seek to rebuild its account, which will take liquidity back out of the system.

#JeromePowell on #tariffs

"Some near-term measures of #inflation expectations have recently moved up. We see this in both market & survey-based measures, & survey respondents, both consumers & businesses, are mentioning tariffs as a driving factor."

#JeromePowell on uncertainty & 'noise'

"As we parse the incoming information, we're focused on separating the signal from the noise as the outlook evolves."

"We do not need to be in a hurry to adjust our policy stance, & we are well positioned to wait for greater clarity."

"While these individual forecasts are always subject to uncertainty, …uncertainty today is unusually elevated. And of course, these projections are not a cmte plan or a decision. Policy is not on a pre-set course."

"The #Fed is as lost in the wilderness as the rest of us trying to decipher the continual shifts in #EconomicPolicy from 1600 Pennsylvania Avenue," said #Inflation Insights' Omair Sharif, referring to the street address of the White House.

"Beyond the cut to median growth this year & the boost to median inflation, the most telling aspect of the (projections) is the shift higher in #uncertainty."

First question: how much of the higher inflation forecast is due to #TrumpTariffs?

#JeromePowell:

"It is going to be very difficult to have a precise assessment of how much of inflation is coming from #tariffs…. clearly some of it [#inflation], a good part of it is, is coming from tariffs.”

"But we'll be working & so will other forecasters to try to find the best possible way to separate non-tariff inflation from tariff inflation."