PANews reported on May 9 that according to Jinshi, Fed Chairman Barr said Trump's trade policy could push up inflation, reduce economic growth and push up unemployment later this year, which could leave policymakers with a tricky decision about which problem to address. "The scale and scope of the recent tariff increases are unprecedented, and we don't know their final form, and it's too early to say how they will affect the economy," Barr said. But he said the risks are obvious. "In my opinion, higher tariffs could lead to disruptions in global supply chains and put continued upward pressure on inflation," he said. He also noted that it takes time for companies to adjust their distribution networks. Some suppliers, especially small businesses, may not be able to adapt quickly enough and may go out of business, which exacerbates supply chain chaos. "I am equally concerned that tariffs will lead to higher unemployment as the economy slows," Barr said. "So if we see both rising inflation and rising unemployment at the same time, the Fed could be in trouble."
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