Federal Reserve Chair Jerome Powell indicated that the projected inflation rate is rising due to uncertainties stemming from President Trump's tariff policies. During a press conference following the FOMC's decision to maintain interest rates, Powell stated that current inflation levels, reaching 2.8% year-over-year, are influenced substantially by tariffs. His comments reflected concerns that these trade policies may delay any further progress desired in reducing inflation, indicating a complex interaction between trade measures and economic stability.
"I do think with the arrival of the tariff inflation, further progress may be delayed," Powell said. He added that the FOMC's Summary of Economic Projections "doesn't really show further downward progress on inflation this year, and that's really due to the tariffs coming in."
"A good part of it is coming from tariffs," Powell noted regarding the higher inflation projections, highlighting how uncertainty from Trump's policies is affecting the economy.
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