Federal Reserve Chair Jerome Powell is slated to deliver his semiannual remarks on monetary policy and the economy this week amid growing concerns over the impact of tariffs imposed by the Trump administration. Powell's appearances are scheduled for Tuesday before the Senate Banking Committee and Wednesday before the House Financial Services Committee. The discussions are expected to address how these tariffs could potentially trigger inflation while simultaneously slowing economic growth.
The Federal Reserve is currently holding interest rates steady, a decision that President Donald Trump has endorsed. However, the potential inflationary impact of the tariffs poses a policy dilemma for Fed officials. The central bank is anticipated to maintain this stance until at least June or July, allowing time to evaluate the evolving economic dynamics. Powell and his colleagues have largely refrained from delving deeply into the implications of the Trump tariffs, although some officials have voiced their concerns regarding inflation.
Powell's appearance before the Senate Banking Committee on Tuesday will include a discussion on the state of the labor market. Legislators are expected to press him on his stance regarding the tariffs and their broader economic implications. Additionally, questions may arise about banking regulation, particularly in light of Vice Chair for Supervision Michael Barr's departure and the Fed's ongoing efforts to revamp a set of regulatory proposals.
The session before the House Financial Services Committee on Wednesday will provide further insights into Powell's views and strategies. The stream of his speech is scheduled to commence at 10 a.m. ET, offering an opportunity for nationwide viewers to gain firsthand understanding of the Federal Reserve's approach toward current economic challenges.