California is suing the federal government over Donald Trump’s on-again-off-again tariffs, the governor and attorney general said Wednesday, claiming the American president does not have the right to impose them.The move marks the strongest pushback yet against a tariff roll-out that has sent global stock markets into meltdown, and left businesses across the US fretting about uncertainty.”It’s the worst own-goal in the history of this country,” California Governor Gavin Newsom said. “One of the most self-destructive things that we’ve experienced in modern American history.”With 40 million people and a large, outward-facing economy that accounts for 14 percent of US GDP, California looks set to bear the brunt of the economic damage forecasters expect from recent gyrations.Newsom’s office says California — which would be the world’s fifth-largest economy if it were an independent country — could lose billions of dollars in revenue if Trump’s tariff policies shrink international trade.Trump has long prized tariffs as a tool to achieve what he says is the urgent need to rebalance America’s trading relationships, and pledged on the campaign trail that he would hit imports with extra levies.Initial punitive tariffs against Mexico and Canada were built on with his self-declared “Liberation Day,” which saw onerous charges imposed on scores of countries, including allies and partners.Many of those duties have since been paused, but their chaotic announcement sent global stock markets into spasms, wiping out trillions of dollars of value.Newsom said Trump’s economic mismanagement was costing everyday Americans — including many who voted for Trump — dearly, all while feathering the nests of billionaire donors and friends.The United States, he said, has gone in a matter of weeks “from free capitalism to crony capitalism, just like that.””This is the personification of corruption…this is smash-mouth, in-your-face, every minute of every day, every hour.”How in the hell are we sitting by and allowing this to happen?” said Newsom, who is widely expected to put himself forward as a candidate for the presidency in 2028.The legal action launched Wednesday argues that the International Emergency Economic Powers Act, which Trump has used to impose levies as high as 145 percent, does not grant him the authority to impose tariffs on goods coming into the United States.”We’re asking the court to rein in the president…and uphold the Constitution,” Attorney General Rob Bonta told reporters.”The president is yet again acting as if he’s above the law, he isn’t.”Bonta said the power to impose tariffs rests with Congress, and the suit sought to ensure his actions were rolled back.”It’s simple, Trump does not have the authority to impose these tariffs. He must be stopped.”The case is the latest of more than a dozen lawsuits that California has filed against the Trump administration.

US President Donald Trump’s tariffs will likely push up prices and constrain growth, and could put the Federal Reserve in the unenviable position of having to choose between tackling inflation and unemployment, the central bank’s chair said Wednesday.US financial markets fell following Jerome Powell’s remarks, with all three major Wall Street indices ending the day in the red as investors dumped tech stocks. “Tariffs are highly likely to generate at least a temporary rise in inflation,” Powell told the Economic Club of Chicago, warning that the inflationary effects “could also be more persistent.””Avoiding that outcome will depend on the size of the effects, on how long it takes for them to pass through fully to prices, and, ultimately, on keeping longer-term inflation expectations well anchored,” he added, echoing similar remarks earlier this month. Unlike some other central banks, the US Fed has a dual mandate from Congress to ensure both stable prices and maximum sustainable employment over time.It keeps those twin objectives in balance by lowering or raising interest rates, which act as either a throttle or a brake for demand in the world’s largest economy.Powell said that while the Fed’s employment and inflation goals were largely in balance, policymakers could find themselves in the “challenging scenario in which our dual-mandate goals are in tension.”- ‘Continued volatility’ -Trump’s stop-start tariff policy has unnerved investors and trading partners unsure about the long-term strategy, and what it might mean for international trade. Amid the rollout of the tariffs, global financial markets spiraled, pushing volatility to heights not seen since the onset of the Covid-19 pandemic.  “You’ll probably see continued volatility,” Powell said Wednesday. “But I wouldn’t try to be definitive about exactly what’s causing that.””I would just say markets are orderly and they’re functioning kind of as you would expect them to in this time of high uncertainty,” he added. Most economists have warned that tariffs will push up prices — at least temporarily — while acting as a drag on growth.The Trump administration has insisted that the levies are just one part of an overall economic agenda including tax cuts and deregulation designed to stimulate supply, boost growth, temper inflation, and return manufacturing jobs to the United States.Tariffs would be “likely to move us away from our goals,” Powell said, referring to the Fed’s dual mandate.Futures traders currently see a roughly 85 percent chance that the Fed will vote to pause again at the next interest rate decision in May, according to data from CME Group.