economy

March 3, 2026

New York Fed's Williams says tariff burden falls 'overwhelmingly' on U.S. businesses and consumers

Williams said that not only were the tariffs being felt at home, but they also were keeping the Fed from reaching its 2% inflation goal.

New York Fed's Williams says tariff burden falls 'overwhelmingly' on U.S. businesses and consumers

TL;DR

  • New York Fed President John Williams asserts that U.S. consumers and businesses are bearing most of the cost of President Trump's tariffs.
  • A New York Fed analysis estimates that up to 90% of the added cost from tariffs has been passed on to domestic producers and consumers.
  • The tariffs have contributed significantly to current inflation, hindering the Fed's progress toward its 2% inflation target.
  • Williams expects the tariff impact on inflation to be temporary, with the Fed reaching its target by 2027.
  • He believes current Fed policy is well-positioned, but future rate reductions may be warranted if inflation falls below target after tariff effects fade.

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