Chairman of Federal Reserve Jerome Powell said that on Friday he hoped that President Donald Trump’s tariff policy would raise prices and slow down economic growth, while noting that the main indicators “still show a solid economy.”
Changes in the policy adopted by the White House have contributed to “very uncertain views,” Powell said, making the statement a plummeting stock amid the increasing global trade war.
Apart from the murky view, Powell said Trump rates were likely to increase consumer prices.
“While the tariff is very likely to produce at least a temporary inflation improvement, the effect will also be more persistent,” Powell told the audience at the Society for Advancing Business Editing and Writing Conference in Washington, DC
A few minutes before Powell was determined to speak, Trump sharply criticized Fed’s chair, asking him to reduce interest rates.
Federal Chairperson Jerome Powell spoke during a press conference after a meeting of the Federal Open Market Committee, March 19, 2025, at the Federal Reserve in Washington.
Kevin Dietsch/Getty Image
“This will be the right time for Chairman Fed Jerome Powell to cut interest rates,” Trump said in a post about social truth.
Trump also claims without evidence that political considerations have played a role in Powell’s decision making about interest rate policies.
On Friday, Powell refused to directly respond to Trump. However, Powell really reprimanded concerns about his political independence.
“I did not respond to political statements,” Powell said, added that it was not appropriate for the central bank to comment on US trade policies.
“We try to remain as far as we can from the political process,” Powell said. “That’s what people expect from us.”
The statement from Powell appeared about two weeks after Fed chose to hold a stable interest rate, even when the central bank said he hoped for higher inflation and slower economic growth than those expected in December.
Despite the increasing tension of trade and market turbulence since Trump served in January, the economy remained in strong condition by several main steps.
The unemployment rate is at a low historical level. Meanwhile, inflation is far below the peak achieved in 2022, although the price increase registers almost a percentage of points higher than the Fed goal of 2%.
The new job report on Friday showed a surge in recruitment last month, exceeding the expectations of economists and opposing the increasing concerns on Wall Street about the possibility of recession.
The US added 228,000 jobs in March, according to data from the US Manpower Statistics Bureau. That number marks a large increase of 151,000 jobs added in the previous month.
However, a backward report on the labor market failed to relieve investor concerns after the sweeping rates issued by Trump earlier this week.
On Friday, the average Dow Jones industry plummeted 1,600 points, or 4%, while S& P 500 plummeted 4.5%. Nasdaq heavy technology dropped 4.6%.
The seller who exceeded losses from Thursday, which marked the worst trade day since 2020.
Overcoming a conference in Washington, DC, on Friday, Powell said it was still too early to determine how Trump’s administrative policy changes would have an impact on the future interest rate decisions.
For now, said Powell, “Too fast to say what will be the right path for monetary policy.”
This is a developing story. Please check again for updates.