Quick overview

---

Jerome Powell, the Federal Reserve chief, told members of the House of Representatives that the central bank is “well-positioned to wait” on interest rate changes until it is clearer how President Trump’s tariffs will impact inflation and the trajectory of the US economy.

Powell has been bolstered in his wait-and-see approach as the White House and some of his fellow central bank policymakers are putting increasing pressure on him to lower interest rates. Powell stated in his semiannual testimony before the House Committee on Financial Services that increased tariffs this year will raise prices and hurt economic activity.

The effects on inflation might be temporary because it represents a one-time change in the level of prices.

In addition, he reiterated the caution he underlined last week following the central bank’s decision to maintain monetary policy unchanged for the fourth consecutive meeting: “Perhaps the inflationary effects could instead be more persistent.”. Well, the Fed is doing well.

Trump stepped up his attacks at the end of last week, saying that Powell and the Fed’s Board of Governors: “I don’t know why the Board doesn’t override this Total and Complete Moron!” He also called for rates to drop from 4.25 percent to 1-2 percent.