Trump's interest rate cut appeal gains support! Milan and Brad speak out: Tariffs have not caused inflation

According to the Zhitong Finance APP, two economists who play a key role in filling the vacancies at the Federal Reserve stated on Tuesday that they do not believe tariffs will lead to inflation, a view that aligns with U.S. President Donald Trump's desire for the Federal Reserve to lower interest rates. Reports indicate that Stephen Moore and James Bullard dismissed the views of many non-White House economists during an interview, which suggested that tariffs would lead to long-term price increases.

Trump has nominated White House Council of Economic Advisers Chairman Moore to fill the vacancy left by the sudden resignation of Federal Reserve Governor Adriana Kugler. This week, reports emerged that at least six candidates, including Bullard, are vying for the position of Federal Reserve Chair. Bullard previously served as the President of the St. Louis Federal Reserve.

Neither of them explicitly stated how they would vote on interest rate issues. However, they praised Trump's economic growth agenda and made statements consistent with Trump's position that inflation is not a problem.

Moore stated, "There is still no evidence that tariffs will trigger inflation."

Previously, the U.S. Bureau of Labor Statistics reported that the Consumer Price Index (CPI) rose 2.7% year-on-year in July, still above the Federal Reserve's 2% target but slightly below Wall Street's expectations.

Bullard indicated that the data continues to show that Trump's aggressive tariffs have not led to inflation. He predicts that the Federal Open Market Committee (FOMC), responsible for setting interest rates, will begin to lower rates starting in September and may adjust the benchmark rate down by a full percentage point over the next 12 months, stating that this would bring rates "close" to neutral.

He remarked, "When the tariff issue arose six months ago, the committee paused its rate-cutting plans, and now we have six months of relevant data. I believe tariffs do not lead to inflation, nor do taxes lead to inflation. So from the data, we can see that price levels have increased slightly in a one-time manner, with little impact."

Both Moore and Bullard emphasized the importance of the Federal Reserve's independence. This issue has been tested during Trump's two presidential terms, as Trump has publicly and vehemently criticized policymakers for not lowering interest rates. Following the CPI data release, Trump continued to attack Federal Reserve Chairman Jerome Powell on social media and again called for the Federal Reserve to ease monetary policy. Trump has stated that the Federal Reserve should cut rates by 3 percentage points.

Trump wrote, "Powell is always slow to act, and the damage is incalculable. Fortunately, the economy is doing very well, and we have freed ourselves from Powell and the complacent committee."