Jerome Powell Cautions About Tariff Uncertainty and Economic Impact

2 mins mins

Key Points:

Fed Chairman Jerome Powell warns of tariff-induced economic uncertainty.
Investors react with major index declines.
Potential inflation spikes and slower growth discussed.

Authorities and industry groups have expressed concern over trade impacts. Notable voices, including JPMorgan’s Ben Michele, have suggested increased recession risks as a consequence of escalating tariffs.

Past tariff hikes often led to higher inflation and slow growth, echoing Powell’s warnings today.

Market Reactions and Analysis

Investors reacted sharply to Powell’s comments, leading to notable declines in major indices such as the Dow Jones, S&P 500, and NASDAQ, dropping nearly 6% each in a volatile two-day period.

Jerome Powell outlined the economic challenges posed by tariffs, highlighting an increase in economic uncertainty and potential inflation spikes. The unexpected scale of tariff increases complicates economic projections and influences employment and pricing strategies.

The stock market reacted negatively, with major indices experiencing substantial losses following Powell’s remarks. Investors are adjusting to higher tariffs, considering the potential for prolonged economic challenges.

Tariffs, Inflation, and Markets: Options and Risks

Did you know? Historical data shows that inflationary pressures from tariffs can lead to extended economic slowdowns, affecting market dynamics and investment strategies.

According to CoinMarketCap, Ethereum (ETH) currently trades at $1791.55, reflecting recent volatility influenced by broader economic uncertainty. The market capitalization is approximately $216.19 billion, with a notable 24-hour trading volume decrease of 64.56%. Ethereum’s value has decreased by 50.83% over the past 90 days.

ethereum-daily-chart-43 — Ethereum(ETH), daily chart, screenshot on CoinMarketCap at 21:36 UTC on April 5, 2025. *Source: CoinMarketCap*

The Coincu research team comments that heightened tariffs can accelerate inflation, which may challenge the U.S. Federal Reserve’s long-term inflation management goals.