On April 16, 2025, Federal Reserve Chairman Jerome Powell expressed deep concerns during a highly anticipated speech regarding the recent announcement of aggressive tariff policies by the Trump administration, warning that they could lead the U.S. economy into a stagflation predicament—where economic growth slows while inflation rises. This statement quickly triggered a violent reaction in the financial markets, with the price of Bitcoin (BTC) dropping approximately 2.5% within minutes of the speech to $83,700, and the U.S. stock market also suffered, with the Nasdaq index plummeting 3.4%, hitting its lowest point of the day.

In his speech, Powell clearly pointed out that the tariffs imposed by the Trump administration on imports from about 60 countries, including China, were significantly higher than market expectations. The tariffs on Chinese goods reached as high as 125%, while those on the EU and Vietnam were set at 20% and 46%, respectively. He stated, "The level of tariff increases announced so far is significantly higher than expected, and the economic impact may be similar, including higher inflation and slower growth."

Powell further warned that these tariff policies could pose unprecedented challenges to the Federal Reserve's dual mandate—achieving maximum employment and price stability. "We may find ourselves in a challenging situation where there is tension between our dual mandate goals." This statement suggests that the Federal Reserve may be forced to maintain high interest rates for a longer period due to inflationary pressures caused by tariffs, further suppressing economic growth and creating a stagflation pattern similar to that of the 1970s.

Additionally, Powell emphasized that the Federal Reserve currently has no intention of immediately adjusting monetary policy but will closely monitor economic data to assess the actual impact of the tariffs. He stated, "We will maintain policy stability until the situation becomes clearer, and we are not in a hurry to decide on the monetary policy path."

Powell's hawkish remarks quickly triggered market turmoil. The price of Bitcoin fell about 2.5% within minutes of the speech, trading at $83,700, with a 24-hour decline of 1.5%. Although Bitcoin had previously seen a mild rebound and was expected to challenge the $86,000 mark, Powell's warning caused market sentiment to plummet.

The U.S. stock market also did not escape unscathed. The Nasdaq index dropped 3.4% following Powell's speech, with technology and chip stocks leading the decline, and shares of leading companies like Nvidia plummeting. The Dow Jones Industrial Average and the S&P 500 attempted to rebound at one point but ultimately closed with lackluster performance.

Powell acknowledged in his speech that tariffs could bring about a "one-time inflation shock," but if long-term inflation expectations become uncontrollable, the Federal Reserve would have no choice but to maintain high interest rates to curb rising prices. He reiterated, "Without price stability, we cannot achieve a strong labor market that benefits all Americans in the long run."

The Federal Reserve finds itself in a dilemma in the current economic environment. On one hand, strong employment data and economic growth provide the Fed with a reason to maintain high interest rates; on the other hand, inflationary pressures from tariffs may force the Fed to delay interest rate cuts or even tighten policy further. Powell stated that the Federal Reserve would flexibly adjust its policy based on data, but "the current economic situation is relatively clear, and the direction of subsequent economic data is of utmost importance."

Market participants expect the Federal Reserve to adopt a wait-and-see approach in the upcoming meetings, waiting for the actual impact of the tariff policies to gradually emerge. Diane Swonk, chief economist at KPMG, pointed out that the Federal Reserve needs to weigh whether it can ignore short-term inflationary signals or choose to maintain high interest rates in the long term to address persistent inflation risks.

This article represents the author's personal views and does not reflect the position or views of this platform. This article is for informational sharing only and does not constitute any investment advice to anyone.

AiCoin official website: aicoin.com

Telegram: t.me/aicoincn

Twitter: x.com/AiCoinzh

Email: support@aicoin.com

Group chat: Customer Service Yingying、Customer Service KK

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。