CNBC Fed Survey: Respondents Criticize Trump Administration's Tariffs and Tax Policies

Survey Findings on Trump Administration Policies

• 🎯 Respondents in the latest CNBC-Federal Reserve survey have given poor marks to the two most visible policies of the Trump administration: tariffs and tax cuts.
• 📊 Tariff policy is viewed by 32 respondents as uniformly bad for inflation, growth, and jobs, with 88% stating it's detrimental to growth.
• 📉 This sentiment is linked to a downgrade in the GDP outlook and an upgrade in recession probabilities.

Impact on Manufacturing and Inflation

• 🏭 Skepticism exists regarding tariffs' ability to bring back manufacturing, with only 37% seeing a potential increase, while 34% anticipate a decline.
• 📈 Tariffs are described as a tax hike that will boost prices and depress growth, pushing public's long-term inflation expectations sharply higher.
• ⚠️ This poses a dilemma for the Federal Reserve, especially if the economy slows down.

Economic Outlook and Fed Policy Expectations

• 📉 The administration's tax policy is also seen as negative for growth and unemployment, though 75% believe it will have a deflationary impact.
• ❓ Forecasters are struggling to price in the upside from the president's policies, despite his claims.
• 📈 The survey indicates raised growth and inflation outlooks, with a somewhat greater chance of recession.
• 📉 Respondents anticipate two rate cuts this year, a figure that is on the line with the Fed's summary of economic projections.