In the early hours of April 24, the Federal Reserve released the latest edition of its U.S. economic conditions report (the "Beige Book"). The report indicates that due to increasing economic uncertainty, notably concerning tariffs, the economic outlook in several U.S. regions has significantly deteriorated. The Beige Book pointed out that the uncertainty stemming from tariff policies is leading to higher costs for businesses, with prices generally rising in multiple regions. The term "tariff" was mentioned 107 times in this report, more than doubling from the previous edition, and words related to "uncertainty" appeared frequently, 89 times. The report also noted that businesses expect to pass on higher costs to consumers, and in some areas, companies are preparing for layoffs.
In addition, the conflict between Trump and Federal Reserve Chairman Powell continues to be a focal point. Recently, Trump stated that the Fed's decision not to cut interest rates further was a mistake and hinted at possibly speaking with Powell. Although Trump had previously denied any intention to dismiss Powell, recent reports suggest his decision received warnings from Treasury Secretary Besent and Commerce Secretary Lutenick, who believed Powell's removal could trigger market turmoil and lead to legal issues. Ultimately, Trump stated that he does not intend to remove Powell but hopes he will take more proactive measures regarding interest rate policy.
Notably, European Central Bank President Lagarde publicly supported Powell, saying that he is fully fulfilling his duties and maintaining financial stability in the United States. Lagarde expressed confidence in Powell's skills and abilities and commended his efforts toward price stability.
