Fed's Kashkari: Tariffs will cause inflation expectations to get out of control, and no more trade deficits means the United States is no longer the best place to invest

Speaking about the economic outlook, Fed's Kashkari (non-voting member) said that tariffs cause inflation to a certain extent and may also lead to slower economic growth. Logically, tariffs will lead to a one-time price increase, but he is worried that tariffs may cause inflation expectations to get out of control against the backdrop of already high inflation. Kashkari said that the Fed's job is to ensure that tariffs do not lead to long-term inflation, and it is too early to judge what is happening. He also said that no longer having a trade deficit means that investors will have to conclude that the United States is no longer the best place to invest, and the fluctuations in bond yields and the US dollar show that global investors have reassessed their investment direction. Kashkari hopes that the United States will maintain its dominance in the global economy and maintain the dollar's status as the world's reserve currency.