Jerome H. Powell, chairman of the Federal Reserve, cautioned that tariffs imposed by President Trump may escalate inflation and hinder economic growth beyond initial forecasts. In a recent speech, Powell noted increasing uncertainty around the size and duration of these tariff effects, which might also contribute to rising unemployment. He emphasized the importance of anchoring long-term inflation expectations to prevent temporary price hikes from evolving into a persistent issue. Despite the economy's current stability, Powell's remarks suggest a cautious outlook moving forward.
Jerome H. Powell warned that President Trump's tariffs risk stoking higher inflation and slower growth than expected, showing elevated uncertainty in economic prospects.
Mr. Powell highlighted that while tariffs will likely cause a temporary rise in inflation, the long-term effects could prove more persistent.
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