- Powell warns that tariffs could spike inflation and hamper growth.
- Marketplace observes defensive trading, subdued asset inflows.
- Crypto industry at risk due to uncertain economic conditions.
Jerome Powell, chair of the U.S. Federal Reserve, highlighted potential risks due to new tariffs, predicting higher inflation and reduced economic growth. The announcement came during an event in Arlington, Virginia.
This news underscores growing concerns about the global economic landscape, with crypto markets reacting by shifting to safer assets amidst elevated uncertainty.
Powell Signals Economic Risks from Rising Tariffs
Jerome Powell’s recent statements indicate substantial risks stemming from tariffs. Higher inflation and slower economic growth are anticipated, fundamentally altering market dynamics. The U.S. Federal Reserve remains cautious amid ongoing uncertainties in fiscal policy and economic recovery scenarios.
Consequently, investors await potential policy shifts that could impact asset values. The central bank’s wait-and-see approach reflects the complex scenario, with Powell acknowledging the necessity of avoiding an inflation escalation from temporary price increases.
“There’s a lot of waiting and seeing going on, including by us, and that just seems like the right thing to do in this period of uncertainty.” — Jerome Powell, Chair, Federal Reserve
Tariff Effects: Cryptocurrency Markets and Historical Insights
Did you know? In 2019, similar economic pressures from tariffs led the Fed to cut rates thrice, unlike the current scenario where sustained inflation concerns hold a firmer grip.
Bitcoin’s market cap stands at $1.69 trillion, with a price of $85,044.65 and dominance of 63.30%, reports CoinMarketCap. Trading volume over 24 hours hit $27.53 billion, reflecting a 0.89% decrease, while Bitcoin showed mixed price changes across timeframes, with a 0.32% 24-hour increase.
Coincu research analysts suggest that continued tariff pressures and inflation risks could shape cryptocurrency valuations. Historical data imply that economic variances influence trading volumes, disrupting potential asset stability, therefore delivering a challenging outlook for investors and policymakers globally.
