The Federal Reserve warned that the economy faced growing risks of higher unemployment and higher inflation when officials unanimously agreed to hold interest rates steady on Wednesday.
“Uncertainty about the economic outlook has increased further,” officials said in their post-meeting statement, the first since President Trump imposed sudden tariff increases last month. “The committee … judges that the risks of higher unemployment and higher inflation have risen.”
Tariffs represent a shock that can decrease an economy’s ability to supply goods or services while sending up prices. The unpredictable rollout of increased duties on imported goods threatens to sap profits and chill new investment until businesses have more clarity on their underlying cost structure.
Source: Fed Warns of Rising Economic Risks as It Leaves Rates Steady – WSJ
