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138 days

The Federal Reserve is not likely to rescue markets and economy from tariff turmoil anytime soon

1. Trump's tariff plans risk inflating prices and slowing economic growth. 2. Fed faces challenging decisions on policy action amid rising inflation risks. 3. Concerns grow over possible recession if tariffs remain high without negotiation. 4. Market expectations shift toward possible Fed rate cuts for growth support. 5. Economic forecasts predict inflation could exceed 3% by 2025 without intervention.

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FAQ

Why Bearish?

Heightened inflation risks originating from tariffs can negatively impact corporate earnings, leading to reduced investor confidence in equities. Historical examples include the 2008 financial crisis, where inflation factors influenced market downturns.

How important is it?

The economic landscape described typically influences broad market sentiment and investor behavior, particularly within the S&P 500, as many constituent companies are sensitive to policy changes affecting trade and growth.

Why Short Term?

Immediate reactions from traders and market analysts indicate potential near-term volatility and price declines due to newly instated tariff risks. The pressure on prices could affect market confidence in the coming quarters.

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