In a wide-ranging interview with Yahoo Finance Federal Reserve Reporter Jennifer Schonberger, Chicago Fed President Austan Goolsbee discusses how tariffs impact his outlook for inflation and what he wants to see from the US economy in order to cut rates.

Higher tariffs put in place by the Trump White House this year have started to increase inflation, and these effects are likely to increase in the coming months, New York Fed President John Williams said Wednesday.

Federal Reserve governor Adriana Kugler said the Fed should hold interest rates steady for a while to come, because new trade barriers are likely to spark more inflation in the months ahead. Speaking at a housing conference in Washington,

Rising prices across an array of goods from coffee to audio equipment to home furnishings pulled inflation higher.

What is clear is that the current 4.33% median Fed funds target rate remains well above the inflation trend. Even after the acceleration in consumer prices in June, the policy rate is roughly 1.4 percentage points above headline CPI’s one-year change – close to the biggest gap post-pandemic.