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The Federal Reserve's fight against inflation just got more complicated as President Donald Trump's tariffs could push up inflation and increase the chances of a recession, economists said.

SINGAPORE/LONDON (Reuters) -Emerging economies worldwide are bracing for sliding currencies and a possible deterioration of their sovereign credit after U.S. President Donald Trump's tariffs brought levies on U.S. imports to their highest levels in 100 years. It could mark a negative turning point for emerging market debt just as many nations had hoped to lure investments after years of risk aversion. "We are immediately concerned by the potential impact of the severe tariffs imposed on a range of emerging economies — an approach which risks further damaging the development prospects of countries already facing worsening terms of trade," said John Denton, Secretary-General of the International Chamber of Commerce.

Morgan Stanley said on Thursday it expects the U.S Federal Reserve will not cut rates this year due to potential elevated inflation levels on the back of Trump's latest tariffs. Trump on Wednesday imposed a 10% baseline tariff on all imports to the U.S. and higher duties on dozens of other countries. The Wall Street brokerage had earlier expected a 25 basis point cut in June.

Tariffs introduce uncertainty into an EV supply chain that companies are investing billions of dollars in, according to the trade group.

LONDON/MOSCOW (Reuters) -Eight OPEC+ countries unexpectedly agreed on Thursday to advance their plan to phase out oil output cuts by increasing output by 411,000 barrels per day in May, a decision that prompted oil prices to extend earlier sharp losses. Oil, which was already down over 4% on U.S. President Donald Trump's announcement of tariffs on trading partners, extended declines after OPEC updated its plans in a statement, with Brent crude dropping over 6% to below $70 a barrel. Eight members of OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies led by Russia, had been scheduled to raise output by 135,000 barrels per day in May as part of a plan to gradually unwind their most recent layer of output cuts.

Retail sales could grow 3.7% at best — or well under 3% — as many consumers reach the limits of their spending power, the trade group said.

Turkey's inflation rate slowed more than expected in March, although domestic political turmoil and Trump tariffs pose risks to price pressures.View on euronews