US Federal Reserve (Fed) Chair Jerome Powell acknowledged on Wednesday that the central bank is facing a growing dilemma in fulfilling its dual mandate of price stability and maximum employment. Speaking against the backdrop of an intensifying global trade war, Powell warned that escalating tariffs could fuel inflation while undermining growth, complicating the path for interest rate decisions.
“We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension,” Powell said in prepared remarks delivered at the Economic Club of Chicago. “If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close.”
