Powell Warns Tariffs May Hit Economy Harder Than Expected
Fed Chair Powell says tariffs could have a stronger economic impact than initially forecasted.
- Jerome Powell highlights deeper-than-expected tariff impact
- Concerns grow over inflation and economic growth slowdown
- Market volatility may rise amid new economic uncertainties
Tariffs Pose Greater Risk, Says Fed Chair Powell
Federal Reserve Chair Jerome Powell issued a warning that has rattled both traditional and crypto markets: the economic impact of tariffs may be larger than expected. Speaking during a recent press event, Powell emphasized that the evolving trade environment could add more pressure on inflation and slow down economic growth.
While tariffs are often introduced as protective measures, they can lead to unintended consequences. These include higher consumer prices, disrupted supply chains, and reduced corporate earnings—all of which can hurt overall economic momentum.
A Ripple Effect Across Markets
Powell’s remarks are already sparking concern among investors. Stocks showed signs of weakness following his statement, and some analysts believe the Fed may need to reassess its rate path if inflation remains elevated due to rising costs from tariffs.
Crypto markets are watching closely too. Historically, when confidence in traditional financial systems wavers, Bitcoin and other decentralized assets often benefit as alternative stores of value. With macro uncertainty rising, digital assets could gain renewed interest as hedges against inflation and geopolitical stress.
What This Means for Investors
Investors should brace for possible volatility. Powell’s statement suggests that policymakers underestimated the long-term effects of tariffs. As the economic picture shifts, we may see changes in interest rate expectations, consumer sentiment, and even government fiscal strategy.
For crypto holders, this could be a pivotal moment. Periods of macroeconomic instability often increase interest in non-sovereign assets. Keeping an eye on how the Fed responds in upcoming meetings will be crucial for both traditional and digital market participants.
