In the near term, risks to inflation are tilted to the upside and risks to employment to the downside - a challenging situation with no risk-free policy path.

Base case: tariff effects on inflation will be relatively short-lived - a one-time price level shift. Obligation is to prevent this from becoming ongoing inflation problem.

With downside risks to employment having risen in recent months, the balance of risks has shifted.

Framework calls for balanced approach to dual mandate. Judged appropriate to lower policy rate by quarter percentage point at this meeting.