US Tariffs Set to Drive Inflation, Impacting Fed Policy

A new report from UBS reveals that US tariffs imposed under the current administration are expected to increase consumer prices by approximately 2% by the end of the year, assuming only partial impact on final consumers. The report highlights the potential economic challenges posed by inflation as it may influence the Federal Reserve’s policy decisions. Analysts predict a slowdown in economic growth and potential job market weakness could lead the Fed to adjust interest rates by up to 75-100 basis points for the remainder of 2025.