The US Federal Reserve Has revised its projection for U.S. economic expansion downward, pointing to the ambiguity around Donald Trump’s stringent tariff strategy.
The Fed’s Open Market Committee (FOMC) now projects 1.7% growth for the US economy in 2025, down from its 2.1% forecast in December before Trump 's inauguration. Additionally, the Fed has kept interest rates at 4.5%.
Jerome Powel l, the Fed Chair observed that any rise in inflation resulting from tariffs might be " transitory. "
Despite market confidence, the FOMC cautioned that the erratic trade policies might result in persistent uncertainty concerning the nation's economic forecast for the remainder of the year.
Powell Additionally, they recognized a decrease in consumer spending and warned that the president’s trade strategies might lead to increased inflation.
" The SEP does not indicate continued decline in inflation for this year, which is largely attributed to the incoming tariffs. ," Powell said.
(QG - Source: The Telegraph - Image: © Unsplash)
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