Federal Reserve Bank of San Francisco President Mary C. Daly was on the news Thursday night, noting that the White House's unbalanced trade policies are keeping the Fed in a wait-and-see mode as policymakers prepare to see what kind of impact on the U.S. economy high import tariffs will have on the broader economy.

Key highlights

The labor market is in solid shape.

Workers are worried about inflation.

We're not going to get to 2% inflation this year.

We're actually making progress on inflation.

I see the balance in the labor market that we need for 2% inflation.

Bond yields show the market is trying to process policy and economic uncertainty.

Fed policy is in good shape. The U.S. economy is in good shape.

On tariffs, I don't know the scope, the size or the timing. It's too early to speculate on what the outcome will be.

The Fed is waiting to see. Businesses are saying they're continuing to do what they're doing, but taking on less risk.

Deregulation and tax breaks are usually positive for growth.

We expect inflation to continue to ease and the labor market to be slow but solid.

What I see is a general sense of cautious optimism.

I expect we will be able to manage policy accordingly.(alg)

Source: FXstreet