By Heather Long
President Trump speaks about steel and aluminum tariffs during a meeting with industry leaders in the Cabinet Room of the White House on March 1. (Mandel Ngan/Getty Images).
One of the United States’ top economists — Boston Federal Reserve President Eric Rosengren — says President Trump’s steel and aluminum tariffs are “not going to have a big impact” on the economy. He doesn’t think the tariffs will trigger a global trade war.
Rosengren predicts a rosy 2018 for the U.S. economy, with more jobs, more spending and more business investment. Everything is going well enough that he’s pushing for the Federal Reserve to raise interest rates more than three times this year.
“We’re in an environment where we’re right at our target if things come out the way I’m expecting in terms of inflation. And we’re pretty low on the unemployment rate,” Rosengren said in an interview with The Washington Post on Friday. “That is good news.”
He credits the GOP tax cuts for boosting growth this year, but he does not think they are having any effect on wages. The small uptick in pay this year is attributable almost entirely to a tight labor market, he says. Companies are struggling to find enough workers and are having to pay more to attract — and keep — them.
“Is the tax cut the primary driver for changes in wages? No. It’s the fact that we have a strong economy that’s generating strong wages,” he said.
Below is a Q&A with Rosengren, edited for length, during which he discussed Trump’s tariffs, tax cuts, jobs, inflation, new Fed Chairman Jerome H. Powell, and the push for more diversity and an end to the 2 percent inflation target at the Fed. The next Fed meeting is March …read more