Fed Waits to See How Trade War Shakes Out

Federal Reserve Chair Jerome Powell said he’s not in a hurry to adjust interest rates in a world where tariffs could lead to higher inflation and unemployment. Unsurprisingly, the US central bank voted unanimously Wednesday to keep the benchmark federal funds rate in a range of 4.25% to 4.5%, where it’s been since December.

President Donald Trump‘s trade policy has unleashed a wave of uncertainty across the economy. Economists widely expect the expansive tariffs to boost inflation and weigh on growth. That would pit policymakers’ two goals—price stability and maximum employment—against one another.