Trump's tariff stick has triggered a series of retaliatory measures from various countries, causing a global financial market crash. Investors are turning their attention to the Federal Reserve, hoping this key player can step in to save the market.However, several Federal Reserve observers point out that we should not expect the Federal Reserve to intervene, as they cannot act hastily. Federal Reserve officials will wait until the economy is substantially affected before lowering interest rates, and this impact will take months to reflect in official data.<h2>Inflation is still high, the Federal Reserve cannot act hastily</h2>On Monday Eastern Time, various media reported that economists and analysts indicated that the Federal Reserve is currently more concerned about another issue—inflation. Data shows that the Federal Reserve's preferred core inflation indicator (PCE) was still as high as 2.8% in February, far exceeding the 2% target. It is worth mentioning that tariffs could potentially drive up prices.In other words, the Federal Reserve is now facing a dilemma: lowering interest rates could save the market but might lead to even more uncontrolled inflation. Not lowering interest rates could stabilize inflation, but the market may become further turbulent, even leading to an economic recession.This is also the reason why many Federal Reserve observers believe we should not expect the Federal Reserve to save the market in the short term.Michael Gapen, Chief U.S. Economist at Morgan Stanley, stated:<blockquote>&#34;If we do not fall into a recession, it will be difficult for the Federal Reserve to address the inflation issue in the short term. The Federal Reserve will keep interest rates unchanged for the foreseeable future.&#34;</blockquote>Federal Reserve Governor Christopher Waller stated on Monday that the impact of tariffs on inflation is more urgent than their impact on economic growth.Former Federal Reserve Vice Chair Lael Brainard also pointed out that inflation puts the Federal Reserve in a bind, as inflationary pressures persist, making it difficult for the Federal Reserve to support the labor market before signs of weakness in the economy and employment appear. This is one of the most challenging situations the Federal Reserve faces.Bloomberg economist Anna Wong noted that if the Federal Reserve is concerned about inflation expectations spiraling out of control, as in 2022, even if the stock market drops 20%, it will not shake its determination to maintain a tightening policy.Market judgments echo the remarks of Federal Reserve Chairman Jerome Powell. He stated last Friday that the Federal Reserve will not rush to respond to market turmoil, and officials have an obligation to keep inflation expectations stable. He mentioned that interest rates are at a favorable position, allowing officials time to assess the impact of Trump's policies on the economy. According to current data, the economy remains in good shape, but he did not mention the continuous decline in the stock market.<h2>The market cannot just decline; there must also be a liquidity crisis</h2>Historically, Federal Reserve officials have acted decisively to stabilize the situation when the market or economy faces a severe crisis.Sometimes, they do not necessarily wait for the scheduled meeting time; they may hold emergency meetings or cut rates unexpectedly to prevent the economy from falling into a severe recession. A recent example is March 2020, when the pandemic first broke out.In addition to lowering interest rates, the Federal Reserve can also use &#34;temporary lending facilities.&#34; When funds suddenly become difficult to borrow and liquidity tightens in the market, the Federal Reserve quickly lends money to banks and financial institutions to prevent the credit market from collapsingDespite the recent global stock market crash, with trillions of dollars in market value evaporating, the pain in the financial markets has not yet shown signs of liquidity shortages that could prompt Federal Reserve intervention.Of course, if the market spirals further out of control, signs of dysfunction in the U.S. Treasury market or liquidity exhaustion in other key parts of the financial system could prompt the Federal Reserve to take action.James Knightley, Chief International Economist at ING, stated:<blockquote>“Unless market dislocations trigger financial stability risks, I don’t think the Federal Reserve will intervene at this stage.”</blockquote>Some economists suggest that if these warning signals do appear, the Federal Reserve is more likely to opt for specific lending tools rather than immediately resorting to interest rate cuts. For example, when the pandemic first broke out in 2020, the U.S. Treasury market experienced a panic sell-off, prompting the Federal Reserve to immediately launch a large-scale bond-buying program. Similarly, after the collapse of Silicon Valley Bank in 2023, they introduced an emergency lending mechanism to help stabilize the banks.Lou Crandall, Chief Economist at Wrightson ICAP, stated:<blockquote>“If financial pressures escalate further, the Federal Reserve's strategy is to address these issues directly, rather than filling all gaps through interest rates.”</blockquote>Darrell Duffie, a finance professor at Stanford University, indicated that his research with staff at the New York Federal Reserve shows that liquidity in the U.S. Treasury market does indeed decline when macroeconomic volatility increases, as is the case now. When dealers are overwhelmed by market activity and cannot maintain their role as intermediaries, market functions that trigger alarms and require support can occur. However, this situation has not yet happened.Analysts also point out that the Federal Reserve has limited ability to alleviate concerns related to White House policies. Brett Ryan, Senior U.S. Economist at Deutsche Bank, stated:<blockquote>“This is not a problem the Federal Reserve can solve. The real circuit breaker is the Trump administration; they won’t back down but will double down, so you will see the market respond accordingly.”</blockquote>Risk Warning and DisclaimerMarkets are risky, and investments should be made cautiously. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investment based on this is at their own risk

Trump's tariff policy has led to a global financial market crash, and investors are hoping for the Federal Reserve to step in to stabilize the market. However, several observers point out that the Federal Reserve is unlikely to intervene in the short term, as they need to wait for the economy to be substantially affected before considering interest rate cuts. Currently, the Federal Reserve is more focused on inflation issues, with core inflation indicators still above target, and cutting interest rates could exacerbate inflationary pressures. Federal Reserve officials have stated that market turbulence will not affect their determination to maintain a tight policy

- The article discusses the impact of Trump's tariffs on global financial markets, leading to significant declines and investor concerns about the Federal Reserve's potential intervention.  
- Economists indicate that the Fed is unlikely to act quickly due to persistent inflation, with core inflation remaining above the target, complicating their decision-making.  
- While the Fed has tools to address liquidity issues, analysts suggest that intervention will only occur if financial stability is at risk, rather than in response to market declines alone.

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Will the Federal Reserve rescue the market after the crash? Analysts: Don't expect it in the short term