Powell Drops Truth Bomb: Tariffs Are Fueling Inflation Fire
Fed chair Jerome Powell just threw gasoline on the inflation debate—and tariffs are holding the match.
### The Tariff-Inflation Tango
Forget 'transitory.' Powell's latest remarks confirm what crypto degens knew all along: protectionist policies are pumping prices like a shitcoin meme rally. Every tariff hike? Another log on the inflationary bonfire.
### Central Banks in the Crosshairs
The Fed's stuck playing whack-a-mole—rate hikes here, QT there—while trade wars quietly undermine every effort. Sound familiar? It's the 2018 playbook, but with extra zeros on the damage.
### The Cynic's Take
Wall Street's still betting Powell will pivot. Meanwhile, Bitcoin's network difficulty just hit another ATH—now that's inflation resistance you can't print away.
U.S. Inflation Data
Major banks and analytical firms projected a slight increase in inflation for July. For the Federal Reserve to initiate interest rate cuts, the impact of tariffs on inflation needs to remain limited. With the effective tariff rate now exceeding 17%, recent reports have distinctly captured this effect. Although the Federal Reserve is yet to disclose its interest rate decisions, one more inflation report is expected. Meanwhile, cryptocurrencies are expected to remain volatile. While more Federal Reserve members lean towards interest rate cuts, achieving the necessary consensus of seven members remains elusive, with optimists currently counting only five votes.
Today’s Consumer Price Index (CPI) and tomorrow’s Producer Price Index (PPI) data will heavily influence expectations around interest rate reductions. The figures were just revealed as follows:
- U.S. CPI Announced: 2.7% (Expectation: 2.8% Previous: 2.7%)
- U.S. Core CPI Announced: 3.1% (Expectation: 3% Previous: 2.9%)
The monthly Core PPI rose by 0.3%, aligning with expectations, while headline inflation grew by 0.2% monthly. The overall inflation report exceeded expectations, prompting Bitcoin
$118,442 to recover to $119,000.
