布兰查德是该研究所的高级研究员，也是美国经济协会的前主席。众所周知，他在新冠肺炎（COVID-19）疫情后准确预测出了令央行感到意外的高通货膨胀。① Blanchard, the former chief economist at the IMF, said that Trump's economic policy may cause the economy to overheat and high inflation, forcing the Federal Reserve to raise interest rates again; ② the three policy pillars of Trump's economic plan, tariffs, immigration policies, and tax cuts may all cause inflation to rise; ③ as a result, the Fed may raise interest rates again and strengthen the dollar, which is not what Trump wants.
Financial Services, November 21 (Editor: Zhou Ziyi) Olivier Blanchard (Olivier Blanchard), the former chief economist of the International Monetary Fund (IMF), said on Wednesday (November 20) that US President-elect Donald Trump's economic policies may cause the economy to overheat and higher inflation, and these situations will cause the Federal Reserve to raise interest rates again.
In a recent article published by the Peterson Institute for International Economics (Peterson Institute for International Economics), Blanchard stated, “The risk of a conflict between the Trump administration and the Federal Reserve is very high.”
Blanchard is a senior fellow at the Institute and a former chairman of the American Economic Association. As we all know, he accurately predicted high inflation that surprised the central bank after the COVID-19 (COVID-19) pandemic.
Blanchard pointed out that the three main pillars of Trump's economic plan — imposing tariffs on imported goods, expelling illegal immigrants, and cutting taxes — will all lead to higher inflation.
First, imposing tariffs on imported goods will cause the economy to overheat and increase price pressure; second, expelling illegal immigrants will lead to labor shortages and rising wages; furthermore, tax cuts will cause the economy to overheat.
Blanchard said, “Based on these three reasons, the Federal Reserve may see higher inflation. We don't know how serious this will be, but the Fed's role is to prevent this from happening.”
As a result, the Federal Reserve will likely raise interest rates again and strengthen the dollar, “and assuming that is true, if the Fed does what it has to do, then it will definitely hinder what Trump wants,” Blanchard added.
Blanchard is also very convinced that current Federal Reserve Chairman Powell will firmly insist on the need for potential interest rate hikes until the end of his mid-term term in 2026. Moreover, Trump's chosen candidate for the next Federal Reserve chairman may not be able to keep interest rates low in the face of rising inflation expectations.
He pointed out, “My impression is that the Federal Reserve's mission has always been to maintain stability and low inflation, and most people think the same.”
