Trump Tariffs, Weak Economic Data Raise Alarm Over Stagflation Risks

A resurgence in inflation alongside slowing economic growth has raised fears of stagflation, a condition not seen in the U.S. since the 1970s. Concerns have intensified as President Donald Trump pushes for broad tariffs while economic indicators signal a downturn. Consumer sentiment has dropped to multi-year lows, and spending in January saw its sharpest decline in nearly four years, despite rising incomes. The ISM manufacturing survey showed factory activity barely expanded in February, with new orders plunging and prices surging. Moody’s Analytics Chief Economist Mark Zandi warns the Fed may instead raise rates to combat inflation.