He considered that although the american economy cools down and inflation moderates “slowly”, it is not “opportune to lower rates this year or ease monetary policy”.
Powell said he’s not entirely sure where the central bank will stop with rate hikes as it pushes forward with its efforts to cool inflation.
“There’s more work to do” and the Fed hasn’t decided where it will stop raising rates, with the possibility of going beyond the 5.1% federal funds rate it marked as the terminal rate in its December forecasts, he said. .
The banker celebrated the cooling of inflation, but affirmed that not enough progress has been made for the pressures on prices to return to 2%.
“We will need much more evidence” that inflation is declining to be confident that it is returning to target, he said.
Although the recent data is “encouraging,” “more evidence will be needed to convince us that inflation is moderating on a lasting basis,” the Fed chair said.
With information from agencies
