One of the Federal Reserve's most dovish policymakers is taking a sharp shift toward a more hawkish posture, warning that new trade tariffs and supply chain disruptions could force the Fed into a difficult position—either slowing down planned rate cuts or reconsidering whether to cut at all.

Trade wars could lead to supply-chain disruptions and an inflation spike similar to the early pandemic, Austan Goolsbee said.

Federal Reserve officials take great pains not to comment on fiscal policy, but the looming threat from tariffs is forcing their hand.

Chicago Federal Reserve President Austan Goolsbee warned on Wednesday that ignoring the potential inflationary impact of tariffs would be a mistake, citing the COVID-19 pandemic experience where supply chain disruptions drove up inflation.