00:00In support of our goals, today the Federal Open Market Committee decided to leave our
00:20policy interest rate unchanged.
00:23The risks of higher unemployment and higher inflation appear to have risen, and we believe
00:28that the current stance of monetary policy leaves us well-positioned to respond in a timely
00:33way to potential economic developments.
00:37If the large increases in tariffs that have been announced are sustained, they are likely
00:43to generate a rise in inflation, a slowdown in economic growth, and an increase in unemployment.
00:48The effects on inflation could be short-lived, reflecting a one-time shift in the price level.
00:53It is also possible that the inflationary effects could instead be more persistent.
00:59Avoiding that outcome will depend on the size of the tariff effects, on how long it takes
01:04for them to pass through fully into prices, and ultimately on keeping longer-term inflation
01:08expectations well anchored.
01:12We may find ourselves in the challenging scenario in which our dual mandate goals are in tension.
01:17If that were to occur, we would consider how far the economy is from each goal and the potentially
01:22different time horizons over which those respective gaps would be anticipated to close.
01:28For the time being, we are well-positioned to wait for greater clarity before considering
01:32any adjustments to our policy stance.
01:36The labor market appears to be solid.
01:39Inflation is running just a bit above 2 percent.
01:42So it is an economy that has been resilient and is in good shape.
01:45And our policy is sort of modestly or moderately restrictive.
01:50It is 100 basis points less restrictive than it was last fall.
01:54And so we think that leaves us in a good place to wait and see.
01:57We don't think we need to be in a hurry.
01:58We think we can be patient.
02:00We are going to be watching the data.
02:02The data may move quickly or slowly.
02:04But we do think we are in a good position where we are to let things evolve and become
02:10clearer in terms of what should be the monetary policy response.
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