U.S. Economic Slowdown Raises Concerns Amid Tariff Challenges

U.S. economic growth is facing a slowdown due to modest consumer spending and an influx of imports to evade tariffs. Fed Chair Jerome Powell announced the decision to maintain interest rates, awaiting more clarity on economic conditions, while indicating potential larger-than-expected impacts from policy changes.

Economic growth in the U.S. appears to be decelerating, as signs point to modest consumer spending and increased imports aimed at avoiding tariffs. These factors could negatively affect GDP estimates, according to U.S. Federal Reserve Chair Jerome Powell.

In his remarks at the Economic Club of Chicago, Powell stated that the Federal Reserve would keep interest rates steady for the time being, awaiting further clarity before making policy changes. He noted that the effects of current tariff policies might be more significant than previously anticipated.

Market reactions reflected the concerns, with the S&P 500 declining, the yield on the 10-year Treasury bond dropping, and the dollar index falling. Analysts stressed that the Fed is in a wait-and-see mode to gauge the long-term impacts of tariffs and inflationary pressures.

(With inputs from agencies.)