Powell Had No Choice But to Speak Out, George Says

Summary

Former Kansas City Fed President Esther George discusses Chair Powell's public defense of central bank independence amid DOJ subpoenas and the Supreme Court case involving Lisa Cook. She argues the Fed should pause rate cuts because inflation risks are skewed higher from unfinished tariff pass-through, easy financial conditions, and fiscal tailwinds. She also says labor-market data are distorted and warrant patience before further easing.

• Esther George says Powell had no choice but to defend Fed independence after DOJ subpoenas.
• George sees the Supreme Court case on removing Fed governors as consequential for the Fed.
• She favors pausing rate cuts because prior cuts are still working through the economy.
• She expects more inflation pressure in the first half from unfinished tariff pass-through.
• Easy financial conditions and fiscal stimulus add to her inflation caution.
• She says labor-market data are muddled by the shutdown and by shifting labor demand and supply.
• Consumers may continue to bear tariff-related costs, though businesses have tried to limit price increases.