President Donald Trump approved the Federal Reserve for its decision last week to leave interest rates unchanged, an early pivot from his previous demand that the central bank ease “immediately.”

In an exchange with reporters Sunday, Trump said holding its key borrowing level in a range between 4.25%-4.5% was the correct move for the Fed.

“I’m not surprised,” he said regarding the decision, according to multiple reports. “Holding the rates at this point was the right thing to do.”

The statement stood in stark contrast to one Trump delivered when speaking remotely to the World Economic Forum in Davos, Switzerland. In a Jan. 23 appearance, Trump said he would “demand that interest rates drop immediately.”

The president has no direct authority over the Fed, though he does nominate the chairman as well as other board members. Current Chair Jerome Powell is a Trump nominee, and a frequent target of the president’s criticism.

Markets don’t expect the Fed to lower rates until at least June. In his post-meeting news conference last Wednesday, Powell repeatedly asserted that the Fed doesn’t need to be in a “hurry” to lower further after shaving a full percentage point off the fed funds rate from September to December in 2024.

The Fed’s decision-making got potentially more complicated after Trump on Saturday said he would impose aggressive tariffs against Canada, Mexico and China, the three largest U.S. trading partners. Economists worry that the tariffs will drive up prices at a time when inflation has shown signs of easing.

U.S. President Donald Trump this weekend announced hefty tariffs on his country’s three biggest trading partners, leaving investors scrambling to position themselves for a global trade war.

Canada and Mexico face 25% duties on their exports to the U.S., with a lower 10% levy imposed on Chinese goods. Canada has already responded with retaliatory tariffs of 25% against $155 billion of U.S. goods.

Trump has, meanwhile, stated that the European Union will be next in the firing line, with the U.K. also under consideration.

Though Trump repeatedly threatened tariffs on the campaign trail, Deutsche Bank analyst Jim Reid said in a Monday note that the market had been “completely under-pricing the risks” and would now be in “severe shock.”

Among the expected short- to medium-term impacts are a slowdown in global economic growth, particularly in countries with large manufacturing sectors, a spike in oil prices, higher prices for U.S. consumers and higher-for-longer U.S. interest rates, with a stronger U.S. dollar as a result.

Outside of the U.S. and the three other economies directly involved, sectors around the world are braced for impact from the tariffs.

Here are some of the areas expected to be hit:

Germany’s Volkswagen, for example, owns Mexico’s biggest car factory where it produces vehicles for export to the U.S. Analysis by RBC Capital Markets estimates the company could see a 9% cut to its earnings as a result of tariffs in a worst-case scenario, while Stellantis — which owns Chrysler and Jeep — also has major operations in Mexico, including the production of Ram pickup trucks, and see a 12% hit to earnings.

The effects on stocks were immediate on Monday, with European automakers on the regional Stoxx 600 index plunging 3.4%, and part suppliers including Valeo and Forvia also tumbling on expectations of a sector slowdown.

Makers of chips and semiconductor equipment, ranging from Taiwan’s TSMC to the Netherlands’ ASML, are braced for a tariff impact given the industry’s global supply chains — including factories in Mexico and China — and because of a potential slowdown in demand.

Taiwan Semiconductor Manufacturing Co, the world’s largest chipmaker, specializes in making semiconductors for other companies, such as U.S. firms Apple, Nvidia, AMD, Qualcomm and Intel.

ASML, meanwhile, manufactures the extreme ultraviolet lithography (EUV) machines used by many global chipmakers to print intricate designs on chips. ASML ships these tools to multiple countries, including the U.S., Taiwan and South Korea.

“The latest moves won’t do much to calm the high tensions which have hit the semiconductor sector,” Susannah Streeter, head of money and markets at Hargreaves Lansdown, said Monday.

“Companies like Nvidia rely on the production of chips from outsourced factories overseas, like China and Mexico – but many other parts needed to construct AI data centers could also be vulnerable to tariffs, given they are imported.”

For the U.S. consumer, a host of household and leisure goods made overseas could be set for price increases, from furniture and electrical appliances to clothing, video consoles, phones and toys.

Elsewhere, there will be an impact on U.S.-exported products sent to countries such as Canada which retaliate with tariffs — as well as on consumer goods firms around the world that send products across the U.S.’ borders.

One example is drinks giant Diageo, which has already been struggling with weakening demand in North America.

Fintan Ryan, consumer equity research analyst at Goodbody, told CNBC that tariffs were one of the biggest challenges for the company this year as the U.S. accounts for roughly 45% of the company’s operating profit.

Around 70% of its sales in the U.S. are imports, meanwhile, including Canadian whiskey, Mexican Tequila, Scotch, and Baileys and Guinness from EU member Ireland. Diageo is due to report earnings on Tuesday.

This is because Trump has halted a trade exemption known as “de minimis,” which had allowed exporters to ship packages worth less than $800 into the U.S. duty-free.

U.S. officials have claimed the exemption allowed Chinese e-commerce companies to undercut their competitors and flagged safety concerns due to their “minimal documentation and inspection.”

The U.S. processed more than 1.3 billion de minimis shipments in 2024, according to data from the U.S. Customs and Border Protection agency.

Without the exemption, high-volume, low-cost products from China’s online retailers will face duties, potentially pushing up the end price of the items and causing a fall in demand.

— CNBC’s Ganesh Rao, Michael Bloom, Annie Palmer and Ryan Browne contributed to this story.

When it came time for Diane Wetherington to consider retirement, reality quickly set in.

The 72-year-old debated devoting her time to crafting and doting over her grandkids and even gave full-time retirement a try. But she soon realized her Social Security checks, which were smaller than her peers’ due to time she spent out of the workforce while raising children, wouldn’t be enough to cover travel or rising insurance costs on top of basic needs.

Now, the Central Florida resident works part time as a remote contracting agent in local government. While she sometimes has to miss out on plans with fully retired friends, she said, continuing to work has kept her budget sound and her mind active.

“It’s just getting very hard to make ends meet,” Wetherington said. “The way the world is right now, everything’s going up, up, up.”

Wetherington is part of a growing body of Americans staying in the workforce past 65, once a traditional marker for retirement. This trend has buoyed the national labor market after years defined by pandemic-induced worker shortages and high quitting rates. It’s also changed the financial outlook for those who remain employed in some capacity, whether for personal satisfaction or monetary need.

This trend should be more apparent than ever in 2025, when more Americans are expected to turn 65 than in any past year, according to a widely read study from the Alliance for Lifetime Income. It dubbed a multiyear period in the late 2020s as the “Peak 65 zone.”

The number of employed Americans 65 and older ballooned more than 33% between 2015 and 2024, according to a CNBC analysis of data from the Bureau of Labor Statistics. By comparison, the labor force for all workers 16 or older has increased less than 9% during the same time period.

That growth has meant workers ages 65 and older accounted for 7% of the total workforce in 2024. That share is up from around 5.7% a decade ago.

“It’s really hard for many employers in many sectors to fill key workforce needs right now,” said Jim Malatras, strategy chief at FedCap, a nonprofit that helps train and place people in jobs. Tapping this age group “can help build key capacity where it’s desperately needed.”

But structural shifts in the retirement system have also encouraged working later in life, Quinby said. The transition in the private sector from employer-funded pensions to 401(k)s and other defined-contribution plans created a need for many workers to remain employed longer. Social Security reforms in the 1980s pushed the program’s “full retirement age” from 65 to 67. 

“People really do use the Social Security full retirement age as an anchor in terms of when they should retire and claim benefits,” Quinby said. “That shift triggered a trend in people working longer.”

Longer life spans have pushed a growing chorus of voices to call for the age of retirement to move back even further, especially as financial uncertainties swirl around Social Security. BlackRock Chair Larry Fink, for instance, said in an annual letter that it’s “a bit crazy” that the expectation of retiring at 65 “originates from the time of the Ottoman Empire.”

Yet there are vastly different reasons and experiences for people of retirement age to continue working in some capacity, said Teresa Ghilarducci, director of The New School’s Retirement Equity Lab.

Some do retire, and some continue to work in jobs that they love out of passion alone. But she said about two-thirds of those still working do it “because they have to.” They can be in jobs with high physical or mental requirements, she said, but they see few alternatives, given that their Social Security checks can’t sustain them.

“I call it the tale of two retirements,” Ghilarducci said.

Booking.com parent Booking Holdings offers 10 days off annually for so-called grandparent leave, which is separate from time offered to new parents and other paid days off. Grocery store chain Wegmans has a section of its part-time jobs page specifically targeted to seniors, advertising the opportunity to stay active and earn income during retirement.

Retirement-age workers can be seen working in gift shops or greeting restaurant guests for Xanterra, a travel company that owns properties in and around national parks. The company has a program called Helping Hands, which allows Xanterra to staff up during the peak tourist season by offering gigs that typically last a month and a half with 30-hour workweeks.

“The retirement community, or that older workforce, is really an integral part of our overall workforce planning strategy,” said Shannon Dierenbach, Xanterra’s human resources chief. “They certainly bring a level of expertise, wisdom, life skills, perspective that really enhances the overall experience.”

Despite these anecdotes, advocates say a pervasive culture of ageism has continued to hurt these Americans in the workforce. “They’re like vintage cars to us,” said FedCap’s Malatras. “They’re built to last, they’re full of value, but they’re treated often like high-mileage Pintos, and they don’t really have an opportunity to serve anymore.”

Employers hoping to better advertise to this community should look at job descriptions and pictures on their jobs pages to ensure there aren’t any subtle signs they favor younger applicants, according to Heather Tinsley-Fix, senior advisor for employer engagement at AARP. She often encourages employers looking for older workers to sign AARP’s pledge, in which businesses commit to measures supporting age equality.

Removing college degree requirements can also help gain the attention of this pool, she said, given that a smaller share completed higher education compared with younger generations. Working from home is a key component of flexibility that these older workers may need, Tinsley-Fix said.

Part of Tinsley-Fix’s argument for employers is the impending “tsunami” of retirements expected within the next decade. If companies don’t tap into groups they previously overlooked, she warned, they’ll struggle to stay at full staffing, as not enough people enter the workforce each year to replace those who left.

Her pitch isn’t all doom-and-gloom, however. Tinsley-Fix said there’s a silver lining: These workers tend to excel at soft skills and can provide mentorship to younger staffers. At Xanterra’s sites, for example, retirement-age workers interact particularly well with customers and stay calm under pressure, Dierenbach said.

“People talk about all kinds of spillover dividends from having older workers on their teams,” Tinsley-Fix said. “They really benefit from having those folks.”