Federal Reserve Chair Jerome Powell acknowledged heightened economic uncertainty, emphasizing that while the economy remains stable, concerns over trade, immigration, fiscal policy, and regulation are weighing on businesses and consumers. Powell indicated that the Fed will wait for clarity before making any rate adjustments, suggesting that interest rate cuts are unlikely in the near term.

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The labor market, though resilient, is showing early signs of strain—February’s job gains came in at 151,000, below expectations, while unemployment ticked up to 4.1%. Markets are now pricing in a high probability that the Fed will hold rates steady at next week’s policy meeting, with expectations for cuts later in the year fading. Powell underscored that the “net effect” of Trump’s economic policies will ultimately dictate future monetary policy, adding another layer of uncertainty. With tariff risks escalating, inflation pressures lingering, and consumer sentiment slipping, investors remain on edge, bracing for further volatility.

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