As Wall Street gears up for Federal Reserve Chair Jerome Powell‘s press conference on Wednesday at 2:30 p.m. ET, all eyes are on his messaging rather than the central bank’s policy action.
The Fed is widely expected to hold interest rates steady at 4.25%-4.50% for a third consecutive meeting, but what Powell says could move markets.
Tariffs, Trump, Trade: A Shifting Backdrop
Market participants are closely watching for Powell’s tone on the recent trade-related developments. President Donald Trump‘s announcement in April of new tariffs has stirred speculation about potential inflationary pressures and global economic retaliation.
The Fed chair may address how these policies could disrupt the inflation trajectory or weigh on consumer sentiment, which has shown signs of softening.
The first quarter of 2025 brought a puzzling contrast: a strong labor market and solid corporate earnings alongside a negative GDP print, driven largely by a surge in imports.
Powell is likely to clarify whether this contraction is more of a technical than cyclical factor, a point that may be emphasized to ease market concerns.
Trump’s Shadow Over The Fed
Powell is also navigating the increasingly loud political pressure from Trump, who last month called him “too late and wrong” and hinted at removing him—though later walked back those comments.
While markets are discounting the possibility of a premature dismissal—Kalshi …