Powell warned that new tariffs could raise inflation and slow economic growth, which makes sense. From an economic perspective, tariffs are essentially a trade barrier that increases the cost of imported goods. These costs are often passed on to consumers, leading to rising prices, which is inflationary pressure. In addition, if other countries impose retaliatory tariffs on American goods, U.S. exports may be hindered, further dragging down economic growth. Powell mentioned these risks, indicating that he is concerned about the potential chain reaction of tariffs on the real economy, rather than mere theoretical speculation.

He also stated that the Federal Reserve would "stay on the sidelines," reflecting a cautious approach to monetary policy. The main responsibilities of the Federal Reserve are to maintain price stability and promote employment. If tariffs lead to soaring inflation, the Federal Reserve may need to raise interest rates to cool down the economy; however, if economic growth slows, it may need to lower interest rates to stimulate the economy. These two possibilities make the policy outlook "highly uncertain," as Powell said. Therefore, his choice to wait and see may be to await more data, avoiding premature actions that could cause market turmoil.

The phrase "beyond expectations" is quite interesting. Trump's tariff policy may be more aggressive in scale or scope than the Federal Reserve anticipated, catching Powell somewhat off guard. However, he emphasized the "risk of persistent inflation," also hinting that he is more worried about runaway inflation rather than a short-term economic slowdown. This may reflect the current economic environment—inflation is already a sensitive topic, and any additional push could make the Federal Reserve's task of controlling inflation more challenging.

In my view, Powell's stance is very pragmatic. He did not directly criticize the tariff policy (after all, the Federal Reserve aims to remain neutral), but focused on its economic consequences, reminding everyone where the risks lie. At the same time, he is not in a hurry to state specific countermeasures, showing a clear understanding of the complex situation. However, if tariffs are indeed implemented on a large scale, it is uncertain how long this "wait and see" strategy can be maintained. The market and the public may push the Federal Reserve to provide a clear signal, and at that point, merely waiting may not suffice.