The Federal Reserve needs to be extra careful about cutting interest rates in the current environment because inflation expectations are threatened not just by tariffs but also a perceived loss of central bank independence, says Tara Sinclair, who served as deputy assistant secretary for macroeconomics in the Office of Economic Policy at Treasury between 2022 and 2024 and is now chair of The George Washington University's Economics Department.

The heavy mantle of responsibility on the next Fed leader will guide him to set monetary policy independent of President Trump's influence, and should the Fed chair fail to make a convincing case for a desired course of policy, the 11 other members of the rate-setting FOMC would vote according to their own judgement, former Cleveland Fed President Loretta Mester tells Fedspeak.

The U.S. economy is operating under a regime of fiscal dominance that will make it harder for the Federal Reserve to keep a lid on inflation, Eric Leeper, a former Fed economist now at the University of Virginia, said on The FedSpeak Podcast.

ADP chief economist Nela Richardson sees a "slow grind" in the labor market as hiring weakens and employment shows a lack of dynamism. However, she doesn't think the will be enough to trigger Fed rate cuts this year, particularly considering strong wage growth and uncertainty about the path of inflation in a high tariff environment.

U.S. inflation expectations are not contained despite officials assurances to the contrary, which means inflation could quickly resume rising and climb above 4% before the end of the year, says Berkeley economist and SF Fed adviser Yuriy Gorodnichenko, who recently presented a paper at the Fed Board's 2nd Thomas Laubach conference. This will put a Fed in a bind that not only prevents them from cutting interest rates but my even force them to hike, he told MNI.

Former Richmond Fed President Jeffrey Lacker discusses the outlook for interest rate policy and the economy amid the challenge of volatile trade wars, as well as his concerns about the expansion of the Fed's powers in conducting credit policy over time.

ECB economist explains why China might reroute trade to Europe in a higher degree than during the trade tensions in 2018

Ex-Dallas Fed Adviser Danielle DiMartino Booth thinks the U.S. economy was already in recession even before Trump's tariffs hit. Now, she believes the Fed is making a mistake by keeping interest rates steady. She is also concerned about threats to the dollar's safe-have status.

Former Ontario forecasting manager and Oxford Economics Canada analyst Tony Stillo says prior cuts to neutral and concern about tariff inflation will keep the Bank of Canada on hold.

Seth Carpenter, former deputy director the Fed board's division of monetary affairs, thinks the central bank will barely be able to squeeze in another rate cut this year if at all before tariffs boost inflation for a while, leaving policymakers on hold until well into 2026.

Nobel Laureate and MIT economist Simon Johnson said he's worried about the growth- and institution-damaging actions of the Trump administration, but relieved he seems willing to leave monetary policy to the Federal Reserve. 

The Federal Reserve is likely to keep interest rates on hold through much of this year as it seeks clarity on the economic impact of Donald Trump's policies.

The more the central bankers stress uncertainty of the of the outlook the more likely they are to enact easier monetary policy, Bank of France senior economist Klodiana Istrefi told MNI. In her paper 'Interest rate uncertainty and firm decisions' Istrefi and co-authors defined "interest rate uncertainty" as the difference between predictions made in surveys by professional forecasters and actual outcomes.

SEC Economist Samim Ghamami says the neutral rate of interest has risen because of higher U.S. budget deficits, meaning the Fed is likely to cut rates less than otherwise in this cycle.

Investor Ed Devlin says Canada's weak economy needs a quick end to tight monetary policy, and a weaker dollar is no deterrent to central bank officials.

Former Fed board economist Joseph Gagnon thinks President-Elect Donald Trump's tariff and immigration policies will push up inflation again, forcing the Fed to halt rate cuts.

The inflation expectations of eurozone consumers are surprisingly in line with macroeconomic developments and can provide a useful reality check to professional forecasts, European Central Bank economist Omiros Kouvavas told MNI. “Consumer expectations feed into consumers’ actions,” Kouvavas told an MNI podcast, adding that he expected them to continue to track the macroeconomic situation with a lag. The link to the ECB's Article: https://www.ecb.europa.eu/press/economic-bulletin/html/eb202407.en.html#toc19

 The inflationary impact on the eurozone from potential Middle East oil disruptions would have “half the firepower” of the 2022 gas crisis, in the absence of a “catastrophic scenario” involving the closure of the Strait of Hormuz, a senior European Commission energy analyst told MNI. 

Bob Dugan, chief economist of Canada Mortgage and Housing Corp., discusses the industry's capacity limits and falling interest rates.