The News
US Federal Reserve Chair Jerome Powell warned that President Donald Trump’s sweeping tariffs risk spiking inflation and slowing growth, but insisted the economy remains in a “good place.”
“While uncertainty remains elevated, it is now becoming clear that the tariff increases will be significantly larger than expected,” Powell said in a speech Friday. “The same is likely to be true of the economic effects, which will include higher inflation and slower growth.”
Powell said that while tariffs would most likely generate a temporary rise in inflation, he suggested the effects “could be more persistent.”
Minutes before Powell’s speech, Trump urged him to cut interest rates now, saying the Fed chair was “always ‘late.’” Trump has frequently castigated the independent Fed for not aggressively cutting rates.
Powell said it remained “too soon” to determine the “appropriate path for monetary policy.”