The tightening of import duties has led to an increase in inflation expectations in the United States

The tightening of import duties has led to an increase in inflation expectations in the United States. This was announced on March 19 by Jerome Powell, Chairman of the US Federal Reserve System (FRS), which serves as the country's central bank.

At a press conference on Wednesday, he said the Fed was focusing on "separating itself from the noise" when assessing how U.S. President Donald Trump's policies might affect the economic outlook.

"We don't need to rush to adjust our political position," Yahoo quoted him as saying.

It clarifies that the Fed has kept the cost of borrowing at a stable level for two consecutive meetings, maintaining the base interest rate in the range of 4.25–4.5%. The pause followed three consecutive rate cuts at the end of 2024.

The central bank also announced that it would begin slowing the pace of treasury bond withdrawals from its balance sheet starting in April, reducing the number of Treasury bonds allowed to be written off from $25 billion to $5 billion. At the same time, the Fed will maintain the pace of reducing mortgage-backed securities by $35 billion per month.

Fed officials now expect inflation to be higher this year than previously estimated and economic growth to be lower.

Policy makers estimate that the core personal consumption expenditures (PCE) inflation rate will be 2.8% at the end of 2025, compared with the previous 2.5%. And now the U.S. economy is projected to grow at an annualized rate of 1.7% instead of 2.1%. The unemployment rate is expected to rise from 4.3% to 4.4%.

Earlier, on December 20, 2024, it was reported that the world's central banks are cautious in monetary policy because of Trump. Caution is caused by the statement of the US Federal Reserve on monetary policy. The forecast led to the sale of bitcoin, gold and the strengthening of the dollar.