Federal Reserve Governor Christopher Waller predicts a brief inflation spike as a result of President Donald Trump‘s tariffs, comparing the situation to the contentious “tush push” football play.

What Happened: Waller expressed his views in a policy speech in St. Louis on Monday. He proposed two potential outcomes from the tariffs. In the event of larger, more persistent tariffs, Waller anticipates an initial inflation surge to a 4% to 5% range, which would eventually decrease as growth slows and unemployment increases. On the other hand, smaller tariffs would cause inflation to peak at around 3% before declining, reported CNBC.

Waller expects the Fed to reduce interest rates in either scenario, with the timing being the only difference. He stated, “Yes, I am saying that I expect that elevated inflation would be temporary, and ‘temporary’ is another word for transitory.” He believes that the higher inflation caused by tariffs will be short-lived, despite the prolonged inflation surge that began in 2021.

He referenced the Philadelphia Eagles' well-known "tush push" play in this scenario, which the team has successfully employed in short-yardage and goal-line situations.

Waller emphasized that Fed officials would be required to "remain flexible" in charting the future course.

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Why It Matters: In March, the Federal Reserve held the fed funds rate steady at 4.25%-4.50% for the second time in a row, as policymakers continued to monitor inflation trends before considering any policy changes. The economy was expanding at a robust pace, and the labor market remained solid, but inflation was somewhat elevated.

However, despite back-to-back weaker-than-expected inflation reports in March, bond yields continued to rise, leading to speculation that a policy misalignment might soon force the Fed’s hand. The Producer Price Index, a key measure of wholesale prices, fell 0.4% month-over-month in March, marking the largest decline since 2023. On a yearly basis, producer inflation slowed to 2.7%, well below economists’ estimates of 3.3% and down from 3.2% in February.

• READ MORE: Trump Administration Halts $2.2 Billion In Harvard Grants After University Says Don’t Dictate What We Can Teach Or Who We Admit – Benzinga

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.