Learn More about Lumida ETF
Powered by LumidaWealth.com
Lumida News
  • Home
  • EarningsNEW
  • News
    • Alt Assets
    • Crypto
    • Equities
    • Macro
    • Markets
    • Real Estate
  • Lifestyle
    • Family Office
    • Health and Longevity
  • Themes
    • Aging & Longevity
    • AI
    • CRE
    • Digital Assets
    • Legacy Brands
    • Nuclear Renaissance
    • Private Credit
  • About Us
No Result
View All Result
Lumida News
  • Home
  • EarningsNEW
  • News
    • Alt Assets
    • Crypto
    • Equities
    • Macro
    • Markets
    • Real Estate
  • Lifestyle
    • Family Office
    • Health and Longevity
  • Themes
    • Aging & Longevity
    • AI
    • CRE
    • Digital Assets
    • Legacy Brands
    • Nuclear Renaissance
    • Private Credit
  • About Us
No Result
View All Result
Lumida News
No Result
View All Result
  • Lumida Wealth
  • Lumida Ledger
  • LUMIDA ETF
  • About Us
Home News Macro

Fed Faces Tough Choices Amid Trump’s Tariff Rollout: Recession or Stagflation?

by Team Lumida
May 6, 2025
in Macro
Reading Time: 5 mins read
A A
0
Powell Signals Patience: Fed to Lower Rates ‘Over Time’

FILE PHOTO: Federal Reserve Chair Jerome Powell holds a press conference following a two-day meeting of the Federal Open Market Committee on interest rate policy in Washington, U.S., September 18, 2024. REUTERS/Tom Brenner/File Photo

Share on TelegramShare on TwitterShare on FacebookShare on LinkedinShare on Whatsapp

Key Takeaways:

Powered by lumidawealth.com

  • President Trump’s haphazard tariff rollout has placed the Federal Reserve in a difficult position, forcing it to choose between addressing a potential recession or managing stagflation.
  • The Fed is likely to maintain its current interest rate stance, avoiding premature rate cuts to ensure inflation remains under control.
  • Tariffs and supply disruptions are expected to push up prices in the short term, while uncertainty could dampen economic activity, creating stagflation risks.
  • Fed officials are divided on how to respond, with some advocating patience until clear signs of economic weakness emerge, while others suggest a more proactive approach to support growth.
  • Fed Chair Jerome Powell faces challenges in communicating the central bank’s strategy, balancing inflation vigilance with the need to cushion the economy if the labor market deteriorates.

What Happened?

The Federal Reserve is grappling with a lose-lose scenario as President Trump’s tariffs disrupt the economy. The tariffs are expected to drive up prices in the short term while creating uncertainty that could slow economic growth. This leaves the Fed with two difficult options: maintain high interest rates to fight inflation or cut rates to cushion the economy against a potential recession.

Fed Chair Jerome Powell and his colleagues are expected to extend their wait-and-see approach at this week’s policy meeting, emphasizing the need for concrete data—particularly on the labor market—before making any decisions on rate cuts.

The Fed’s cautious stance reflects lessons from past missteps, such as its delayed response to inflation during the pandemic recovery. However, some officials, like Fed Governor Christopher Waller, argue that today’s situation is different, with no clear mechanism for sustained price increases beyond the initial tariff-driven spike.


Why It Matters?

The Fed’s response to the current economic environment will have significant implications for inflation, employment, and overall economic stability. If the central bank acts too soon to cut rates, it risks fueling inflationary pressures. Conversely, waiting too long could deepen a potential recession, especially if the labor market weakens further.

The uncertainty surrounding the duration and magnitude of tariff-driven price increases complicates the Fed’s decision-making process. Officials must also manage public and market expectations, as inflation expectations play a critical role in determining future price trends.

For businesses and consumers, the Fed’s actions will influence borrowing costs, spending, and investment decisions, making its strategy a key factor in navigating the economic fallout from the tariffs.


What’s Next?

The Fed will closely monitor labor market data and consumer spending trends to assess the impact of tariffs and determine the appropriate timing for any rate adjustments. Powell and other officials will also refine their communication strategy to balance inflation vigilance with the need to support economic growth.

The next policy meeting on interest rates will be critical in shaping the Fed’s approach, as divisions among officials over the transitory nature of tariff-driven price increases could influence the pace and direction of future decisions.

Meanwhile, the broader economic impact of Trump’s tariffs will remain a key focus, with businesses and policymakers evaluating their effects on supply chains, prices, and global trade dynamics.

Source
Previous Post

OpenAI Abandons For-Profit Conversion, Opts for Public-Benefit Corporation Under Nonprofit Control

Next Post

Palantir Raises Full-Year Outlook Amid Surging AI Demand, Despite Stock Dip

Recommended For You

Trump’s U-Turn on China Buying Iranian Oil Sparks Confusion Amid Sanctions Policy

by Team Lumida
10 hours ago
Trump Announces 25% Tariffs on Mexico and Canada, Targeting Border Security and Trade

Key Takeaways: Powered by lumidawealth.com President Donald Trump announced on social media that China can continue purchasing oil from Iran, surprising oil traders and U.S. officials and potentially undermining...

Read more

Israel-Iran Conflict Revives China’s Interest in Russian Gas Pipeline Amid Energy Security Concerns

by Team Lumida
11 hours ago
Israel-Iran Conflict Revives China’s Interest in Russian Gas Pipeline Amid Energy Security Concerns

Key Takeaways: Powered by lumidawealth.com The Israel-Iran conflict has prompted China to reconsider the stalled Power of Siberia 2 gas pipeline project with Russia, seeking alternatives to Middle Eastern...

Read more

China Poised for Over 100 AI Breakthroughs, Ex-Official Predicts, Amid Growing U.S. Rivalry

by Team Lumida
1 day ago
China’s Bold Economic Moves: What You Need to Know Now

Key Takeaways: Powered by lumidawealth.com Former Chinese central bank official Zhu Min predicts China will achieve over 100 AI breakthroughs in the next 18 months, transforming its economy and...

Read more

Israel and Iran Agree to Ceasefire After Trump Brokers Truce to End Conflict

by Team Lumida
1 day ago
six fighter jets

Key Takeaways: Powered by lumidawealth.com U.S. President Donald Trump announced a ceasefire between Israel and Iran after escalating tensions and missile strikes from both sides. The truce was brokered...

Read more

Supreme Court Allows Trump Administration to Expedite Deportations to Third Countries

by Team Lumida
2 days ago
Supreme Court Allows Trump Administration to Expedite Deportations to Third Countries

Key Takeaways: Powered by lumidawealth.com The Supreme Court ruled in favor of the Trump administration, allowing the swift deportation of migrants to third-party countries without requiring meaningful notice of...

Read more

Shipping Industry on High Alert After US Strikes on Iran’s Nuclear Facilities

by Team Lumida
2 days ago
red and blue cargo ship on body of water during daytime

Key Takeaways: Powered by lumidawealth.com Greece has advised its shipowners to reassess passage through the Strait of Hormuz, citing heightened risks of Iranian retaliation following US airstrikes. Naval forces...

Read more

U.S. Urges China to Dissuade Iran from Closing Strait of Hormuz Amid Escalating Tensions

by Team Lumida
3 days ago
U.S. Struggles to Break China’s Grip on Critical Minerals as Syrah Resources Faces Setbacks

Key Takeaways: Powered by lumidawealth.com U.S. Secretary of State Marco Rubio called on China to leverage its influence over Iran to prevent the closure of the Strait of Hormuz,...

Read more

China Condemns US Strikes on Iran, Calls for Ceasefire and Middle East Peace

by Team Lumida
3 days ago
China’s Bold Economic Moves: What You Need to Know Now

Key Takeaways: Powered by lumidawealth.com China strongly condemned the US airstrikes on Iranian nuclear facilities, stating they violate the UN Charter and international law while escalating Middle East tensions....

Read more

Trump Signals Two-Week Delay on Iran Strike to Explore Diplomatic Options

by Team Lumida
6 days ago
Fed Official Warns of Inflation Risks Under Trump Presidency

Key Takeaways: Powered by lumidawealth.com President Trump announced he will decide within two weeks whether to strike Iran, signaling a pause to allow for potential diplomatic negotiations. Israel has...

Read more

Canada Imposes Steel Import Curbs to Counter Fallout from Trump’s Tariffs

by Team Lumida
6 days ago
flag of Canada

Key Takeaways: Powered by lumidawealth.com Canada is introducing import quotas and considering higher tariffs on U.S. steel and aluminum to protect its domestic metals sector, destabilized by Trump’s 50%...

Read more
Next Post
a black and white logo

Palantir Raises Full-Year Outlook Amid Surging AI Demand, Despite Stock Dip

gray and black ford emblem

Ford’s Q1 Profit Plunges 64%, Suspends Outlook Amid Tariff Uncertainty

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Related News

person holding white samsung galaxy note 8

Apple Set to Launch New iPhone SE, Aiming to Boost Global Sales with Affordable Option

February 19, 2025
China’s Economic Struggles: Factory Activity Falls Again

China Starts 2025 with Strong Economic Momentum Amid Rising U.S. Tariffs

March 17, 2025
man sitting in front of the laptop

Tech Giant Surpasses Q3 Expectations: What Investors Need to Know

August 5, 2024

Subscribe to Lumida Ledger

Browse by Category

  • Lifestyle
    • Family Office
    • Health and Longevity
    • Next Gen Wealth
    • Trust, Tax, and Estate
  • News
    • Alt Assets
    • Crypto
    • Equities
    • Latest
    • Macro
    • Markets
    • Real Estate
  • Research
    • Trackers
  • Themes
    • Aging & Longevity
    • AI
    • Biotech
    • CRE
    • Cybersecurity
    • Digital Assets
    • Legacy Brands
    • Nuclear Renaissance
    • Private Credit
    • Software
Facebook Twitter Instagram Youtube TikTok LinkedIn
Lumida News

Premium insights to help you invest beyond the ordinary. Lumida Wealth Management LLC (‘Lumida”) is an SEC registered investment adviser

CATEGORIES

  • Aging & Longevity
  • AI
  • Alt Assets
  • Biotech
  • CRE
  • Crypto
  • Cybersecurity
  • Digital Assets
  • Equities
  • Family Office
  • Health and Longevity
  • Latest
  • Legacy Brands
  • Lifestyle
  • Macro
  • Markets
  • News
  • Next Gen Wealth
  • Nuclear Renaissance
  • Private Credit
  • Real Estate
  • Software
  • Themes
  • Trackers
  • Trust, Tax, and Estate

BROWSE BY TAG

AI AI chips AI demand Amazon Apple Artificial Intelligence Banking Bitcoin China Commercial Real Estate CPI Crypto Donald Trump EARNINGS ELON MUSK ETF Ethereum Federal Reserve financial services generative AI Goldman Sachs Google India Inflation Interest Rates Investment Strategy Japan Jerome Powell JPMorgan Markets Meta Microsoft Nasdaq Nvidia OpenAI private equity S&P 500 SEC Semiconductor stock market Tech Stocks tesla Trump Wells Fargo Whale Watch

© 2025 Lumida Wealth Management LLC is an SEC registered investment adviser. Privacy Policy. Cookies Policy.
Disclaimer Important Information This site is for informational purposes only. Information presented on this site does not constitute as investment advice.

Lumida Wealth Management LLC (‘Lumida”) is an SEC registered investment adviser. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability.

Lumida's website (referred to herein as the "Website") is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of the Website on the Internet should not be construed by any client and/or prospective client Lumida’s solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.

Any subsequent, direct communication by Lumida with a prospective client will be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.

‍Lead Capture Forms: By submitting your contact information in the forms on this site, you are not obligated to invest in Lumida's product or services.
‍Address: Lumida Wealth Management, 25 W 39th Street Suite 700, New York, NY 10018

No Result
View All Result
  • Home
  • Earnings
  • News
    • Alt Assets
    • Crypto
    • Equities
    • Macro
    • Markets
    • Real Estate
  • Lifestyle
    • Family Office
    • Health and Longevity
  • Themes
    • Aging & Longevity
    • AI
    • CRE
    • Digital Assets
    • Legacy Brands
    • Nuclear Renaissance
    • Private Credit
  • About Us

© 2025 Lumida Wealth Management LLC is an SEC registered investment adviser. Privacy Policy. Cookies Policy.
Disclaimer Important Information This site is for informational purposes only. Information presented on this site does not constitute as investment advice.

Lumida Wealth Management LLC (‘Lumida”) is an SEC registered investment adviser. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability.

Lumida's website (referred to herein as the "Website") is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of the Website on the Internet should not be construed by any client and/or prospective client Lumida’s solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.

Any subsequent, direct communication by Lumida with a prospective client will be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.

‍Lead Capture Forms: By submitting your contact information in the forms on this site, you are not obligated to invest in Lumida's product or services.
‍Address: Lumida Wealth Management, 25 W 39th Street Suite 700, New York, NY 10018