Federal Reserve Chair Jerome Powell delivered a speech at the Chicago Economic Club today outlining his assessment of the U.S. economy. Key takeaways include: the Fed’s policy stance remains appropriate while awaiting further economic data before adjusting it; the U.S. economy remains strong despite heightened uncertainty and ongoing downside risks; employment is at its highest level, inflation is close to the 2% target, and recent declines in inflation are notable; the first quarter of 2025 is projected to see a slowdown in growth, impacted by robust imports; business and household confidence have fallen due to trade policy concerns. Despite these trends, Powell emphasized a strong labor market and low inflationary pressure. The speech also addressed potential challenges from tariffs, highlighting their impact on inflation and economic growth. The Fed aims to maintain long-term inflation expectations while navigating the delicate balance of competing goals.