Fed Chairman Jerome Powell warned that the U.S. could face an increase in supply shock. The central bank announced that it will Keep interest rates stable In a time of economic uncertainty.
"We may enter a period of more frequent, possibly longer-lasting supply shocks, which is a tough challenge for the economy and the central bank," Powell said at a meeting in Washington, D.C.
Analyst Warned U.S. companies may face inadequate inventory due to supply chain problems caused by tariffs. Container bookings from China to the United States have dropped by as much as 60% Spike forward According to imports from supply chain management company Flexport.
Powell acknowledged at the meeting that the economic environment has changed since the Fed’s last strategic meeting in 2020, when interest rates were well below today.
"The long-term interest rates are now high, mainly due to the stability of long-term inflation expectations," Powell said Thursday, referring to inflation's rate adjustment.
Federal funding rates are currently between 4.25% and 4.50%. The Fed last week Decide to maintain a steady pace - A sign is still weighing the economic risks posed by the Trump administration's tariffs. According to CME FedWatch's forecast, the central bank plans to meet again in mid-June and is expected to keep its benchmark rate within the current range.
Powell also warned that higher real interest rates could release higher inflation fluctuations than the time platform between the "2010s crisis period" (the 2008 financial crisis and the 2020 Covid-19 pandemic period)
inflation Relaxed slightly last month But it still exceeded the Fed's 2% goal.
Powell's comments are a source of economic uncertainty as U.S. consumers and businesses continue to struggle with economic uncertainty. Mr. Trump and his team have Meet with foreign leaders In recent weeks, before negotiating a deal 90-day pause Reciprocal tariffs are held in July.
According to Bloomberg, Mr. Trump said on Thursday at an event with Qatar's business leaders that the Indian government proposed to lift tariffs on U.S. goods.
Recently with U.K. and China Excited the stock market Soared Monday Under the agreement between the United States and China. Still, Wall Street analysts and economists point out High tariffs will not disappear soon.