President Donald Trump’s initial policy proposals raised concern at the Federal Reserve about higher inflation, minutes from the Jan. 28-29 monetary policy meeting revealed. Policymakers are watching the rollout of Trump’s economic-policy plans and how they might shape the economy. While characterizing risks in the economy as roughly balanced, policymakers “generally pointed to upside risks to the inflation outlook,” the minutes said. “Participants cited the possible effects of potential changes in trade and immigration policy, the potential for geopolitical developments to disrupt supply chains, or stronger-than-expected household spending.”
The minutes said “many participants noted that the committee could hold the policy rate at a restrictive level if the economy remained strong and inflation remained elevated.”