Trump said inflation and energy prices have dropped, and job growth remains strong. “Even eggs are down 69%,” he added. “CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!”
His comments came as markets slid following his latest tariff announcement.On Wednesday (April 2), Trump proposed a new round of tariffs, raising fears of a global slowdown and a short-term spike in inflation.
The Federal Reserve, however, signaled caution.
Speaking in Arlington, Virginia, Powell said the central bank would wait for “greater clarity” before cutting rates. He acknowledged the new tariffs were “significantly larger than expected.”Markets are now pricing in more aggressive rate cuts.
Powell said that the tariffs, and their likely impacts on the economy and inflation, are “significantly larger than expected.”
He also said that the import taxes will probably lead to “at least a temporary rise in inflation,” but added that “it is also possible that the effects could be more persistent.”
“Our obligation is to … make certain that a one-time increase in the price level does not become an ongoing inflation problem,” Powell said in remarks delivered to a conference of the Society for Advancing Business Editing and Writing.
Powell’s focus on inflation suggests that the Fed will likely keep its benchmark interest rate unchanged at about 4.3% in the coming months, rather than cut them anytime soon.
Higher borrowing costs can help slow the economy and cool inflation.
–With inputs from AP
