by Rachel Barber
USA Today
Federal Reserve Chair Jerome Powell’s comments Wednesday appeared to heighten financial experts’ fears that tariffs on goods imported to the U.S. could bring about an economic condition known as “stagflation.”
Powell didn’t use the exact word, but said President Donald Trump’s on-again, off-again tariffs were “highly likely” to fuel inflation and could slow growth – two things that when combined have historically marked periods of stagflation.
“Unemployment is likely to go up as the economy slows, in all likelihood, and inflation is likely to go up as tariffs find their way and some part of those tariffs come to be paid by the public,” Powell said in a speech at the Economic Club of Chicago. “So that’s the strong likelihood.”