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137 days

Tariffs Will Increase Inflation, Jerome Powell Warns—As Trump Pressures Fed To Cut Rates

1. Powell indicates tariffs will significantly inflate prices and slow growth. 2. Fed likely to maintain interest rates at 4.3% despite market hopes for cuts. 3. Tariffs will raise prices on imports like cars and food items. 4. Core inflation rate is at 2.8%, above the Fed's 2% target. 5. Economic growth slowdown raises uncertainty over future monetary policy decisions.

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FAQ

Why Bearish?

The fear of rising inflation due to tariffs can dampen investor sentiment, leading to lower stock prices. Historical examples include previous tariff announcements that negatively affected market performance.

How important is it?

The link between tariffs, inflation, and Fed policy is critical for investor expectations, impacting S&P 500 valuations significantly.

Why Short Term?

The immediate effects of tariffs and inflation are likely to be felt soon, impacting consumer spending and corporate earnings in the upcoming quarters.

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