Federal Reserve Chair Jerome Powell testified that the tariffs imposed by President Trump are likely to cause an uptick in inflation as consumers will bear some cost. Powell indicated that despite many Fed officials advocating for interest rate cuts, they want to analyze inflation trends further. Some Republican senators criticized him for suggesting these tariffs could lead to inflation, arguing that they might only induce a one-time price spike. Meanwhile, Powell remains under pressure from the White House regarding rate cuts to alleviate federal borrowing costs.
Federal Reserve Chair Jerome Powell indicated that President Trump's tariffs would likely contribute to inflation, impacting consumers as they shoulder import tax costs.
Powell emphasized the importance of observing inflation data in the coming months before proceeding with potential rate cuts, despite pressure from Republican senators.
Senator Pete Ricketts defended the tariffs, arguing they may not lead to sustained inflation but could result in one-time price increases for consumers.
Powell faced criticism from GOP senators for his stance on tariffs, as some claimed he exhibited bias against the President's trade policies.
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