Federal Reserve Chair Warns of Economic Challenges Ahead

In a significant address at the Second Thomas Laubach Research Conference, United States Federal Reserve Chair Jerome Powell highlighted the potential for higher long-term interest rates, attributing this shift to emerging supply shocks that could complicate economic policy.

"Higher real rates may also reflect the possibility that inflation could be more volatile going forward than in the inter-crisis period of the 2010s," Powell stated, suggesting a departure from the relatively stable inflation rates of the past decade.

Inflation Trends and Policy Concerns

Recent data from the Bureau of Labor Statistics shows a slight decrease in annual inflation to 2.3% in April from 2.4% in March. Despite this, there's growing unease among market participants regarding the new trade policy introduced by the US administration and its potential economic repercussions.