### Kashkari Warns of Inflation Risks from Trump's Tariff Proposals

Minneapolis Federal Reserve President Neel Kashkari has raised alarm bells about potential long-term inflation if President-elect Donald Trump's proposed tariffs ignite retaliatory actions from global trade partners. One of Trump's key economic strategies for his anticipated second term is to levy universal tariffs on all imports, with a particularly aggressive 60% tariff targeted at China.

Economists, Wall Street analysts, and industry leaders have voiced strong concerns over these hardline trade measures, especially since inflation rates have recently shown signs of declining, allowing the Federal Reserve to ease interest rates. Speaking on CBS' "Face the Nation," Kashkari highlighted that although one-time tariffs might not affect long-term inflation, the situation could become significantly more troubling if it escalates into a tit-for-tat tariff battle.

Reflecting on Trump's first term, Kashkari recalled the trade war sparked by import taxes on Chinese goods, which led to reciprocal tariffs from China. He pointed out that while substantial progress has been made in reducing inflation from its pandemic-era highs, the proposed tariffs could derail this progress. "We've made a lot of progress in bringing inflation down," Kashkari stated. "I mean, I don't want to declare victory yet. We need to finish the job, but we're on a good path right now."

The Federal Reserve has recently undertaken its second consecutive interest rate cut, a measure intended to relax monetary policy as inflation trends towards the central bank's 2% target. Kashkari hinted at the possibility of another rate cut in December, contingent on incoming economic data at that time.

Kashkari also addressed other Trump policy proposals, such as a broad immigration deportation plan, noting that the inflationary impact of such measures remains uncertain. Consequently, the Fed is adopting a "wait and see" approach before making any policy adjustments.

Amid discussions of Trump's policies, including input from high-profile supporters like Tesla CEO Elon Musk on Fed decisions, Kashkari emphasized the importance of maintaining the central bank's political independence. He expressed confidence that the Federal Reserve would continue to focus solely on the economic health of the country. "I'm confident that we will continue to focus on our economic jobs," he affirmed. "That's what should be dictating what we're doing and that is what's dictating what we're doing."