Stocks Erase Gains as Powell Flags Inflation Risks: Markets Wrap

A rally in stocks fizzled out after Federal Reserve Chair Jerome Powell warned that tariff-driven economic uncertainty and inflation risk continued to complicate the central bank’s bid to ease monetary policy in earnest. Gains in bonds waned. The dollar barely budged.

Equities closed little changed, with the S&P 500 ending below 6,000 after briefly crossing that mark. Powell noted that increases in tariffs are likely to boost prices, while adding that the effects on inflation could be more persistent. He also declined to say if he’ll stay on after his term ends. Treasury two-year yields, which are more sensitive to imminent Fed moves, almost erased a decline that had earlier reached seven basis points.