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 Former chief economist of the IMF, Blanchard, stated that Trump's economic policies may lead to an overheating economy and high inflation, forcing the Federal Reserve to raise interest rates again; ② The three policy pillars of Trump's economic plan—tariffs, immigration policy, and tax cuts—could all contribute to rising inflation; ③ As a result, the Federal Reserve may raise interest rates again and strengthen the dollar, which is not what Trump desires.
According to a report from Caixin on November 21 (edited by Zhou Ziyi), Olivier Blanchard, the former chief economist of the International Monetary Fund (IMF), stated on Wednesday (November 20) that the economic policies of Donald Trump, the elected President of the usa, may lead to an overheating economy and higher inflation, which would force the Federal Reserve to raise interest rates again.
Blanchard pointed out in a recent article published by the Peterson Institute for International Economics that "the risk of conflict between the Trump administration and the Federal Reserve is very high."
Blanchard is a senior researcher at the institute and a former president of the American Economic Association. He is well known for accurately predicting unexpectedly high inflation that surprised central banks after the COVID-19 pandemic.
Blanchard pointed out that the three main pillars of Trump's economic plan—imposing tariffs on imported commodities, deporting illegal immigrants, and tax cuts—will all lead to higher inflation.
First, imposing tariffs on imported goods will lead to economic overheating and upward pressure on prices; second, deporting illegal immigrants will lead to a labor shortage and wage increases; additionally, tax cuts will also contribute to economic overheating.
Blanchard stated, "Based on these three reasons, the Federal Reserve may see higher inflation. We do not know how severe this will be, but the Federal Reserve's responsibility is to prevent this from happening."
In this way, the Federal Reserve may raise interest rates again and strengthen the dollar, "and assuming this is the case, if the Federal Reserve does what it must do, it will certainly hinder what Trump wants," Blanchard added.
Blanchard is also very confident that before the current chairman of the Federal Reserve, Powell, ends his term in mid-2026, he will firmly insist on the necessity of potential interest rate hikes. Moreover, the next Federal Reserve chairman appointed by Trump may not be able to maintain low interest rates in the face of rising inflation expectations.
He pointed out, "In my impression, the mission of the Federal Reserve has always been to maintain stability and low inflation, and most people believe the same."
