There are a few considerations:
1) This one-off adjustment is coming after a prolonged period of inflation so pass through could be higher (infl expectations)
2) Could lead to more activity in the US to avoid tariffs > inflationary
3) it’s a one-off adjustment but may occur over a period of time
1) This one-off adjustment is coming after a prolonged period of inflation so pass through could be higher (infl expectations)
2) Could lead to more activity in the US to avoid tariffs > inflationary
3) it’s a one-off adjustment but may occur over a period of time
Comments
Currency offset advocates better be advocating for a hawkish Fed or there won't be an offset