Local businesses have expressed increased concerns about tariffs affecting prices and growth, leading to a more cautious approach towards capital projects.

He also noted that executives in Michigan are apprehensive about the reciprocal tariffs that Trump is expected to announce, which could impact the automotive sector and trade relations with Canada and Mexico.

In a recent interview, Chicago Federal Reserve President Austan Goolsbee predicted that interest rates will be significantly lower in the next 12 to 18 months.

FOMC members project two rate cuts through 2025, although market expectations suggest that three cuts may be more likely, according to CME Group data.

Goolsbee acknowledged that while the 'wait and see' strategy is prudent during uncertain times, it does come with its own set of costs.

During a recent news conference, Fed Chair Jerome Powell highlighted the heightened uncertainty in the economic outlook, reiterating the term 'uncertainty' multiple times.

Powell also noted that tariff increases proposed by President Donald Trump could impede progress in reducing inflation, though the Fed believes these effects will be temporary.

Looking ahead, Goolsbee considers the next three to six weeks critical for addressing political uncertainties, marking April 2 as a key date.

He warned that if inflation expectations begin to mirror those from recent surveys, it would be a significant concern for future policymaking.

Goolsbee raised alarms about long-term inflation expectations reaching their highest level since 1993, according to surveys from the University of Michigan.

Despite this optimistic outlook, Goolsbee emphasized a cautious 'wait and see' approach due to rising uncertainties in the economic landscape.

The Federal Open Market Committee (FOMC) recently decided to maintain the benchmark interest rate in the range of 4.25% to 4.50%, with plans to lower rates later this year.