Federal Reserve's Caution Amid Trump's Policy Uncertainty

Federal Reserve Chair Jerome Powell stated the U.S. central bank would wait to adapt its policy due to the re-election of Donald Trump. Powell emphasized the need for policy clarity, noting the unknown impacts of Trump’s plans, like tariffs and immigration control, on inflation and the economy.

Federal Reserve Chair Jerome Powell announced on Thursday that the U.S. central bank is in no rush to adjust its policymaking strategies following the impending return of President-elect Donald Trump to the White House. According to Powell, it's premature to draw conclusions as the specifics of Trump's policies are still unclear.

He indicated that the Federal Reserve will closely monitor actions taken by elected officials, particularly since the recent victory of Republicans in both houses of Congress. Powell expressed confidence that the Fed has ample time to evaluate the economic implications of forthcoming policy decisions before any policy response is necessary.

Trump's previous term saw frequent tension with the Federal Reserve, and his proposed economic strategies pose risks such as inflation and increased deficit spending. Nonetheless, Powell emphasized that the Fed needs concrete policies before updating its economic forecasts, recognizing that uncertainty clouds current economic expectations.

(With inputs from agencies.)