The Federal Reserve is at a crossroads as the White House threatens to impose high and comprehensive tariffs on US imports. This move could severely disrupt production, raise prices, and put a massive strain on the economy’s supply side. Unless the threat is lifted, the central bank will have to decide which part of its dual mandate to prioritize: jobs or low inflation.
The situation is becoming increasingly complex, as pressure mounts on the Fed to support the administration’s economic strategy, despite concerns over inflation. The Fed’s credibility is at stake, and if it fails to navigate this challenge, its ability to make decisions will be compromised.
Source: https://www.bloomberg.com/opinion/articles/2025-04-09/trump-s-tariffs-federal-reserve-may-be-forced-into-difficult-choices