Federal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
His remarks represented a shift for Powell, who on March 7 had told a Senate committee that the Fed was “not far” from gaining the confidence it needed to cut rates.“Recent data have clearly not given us greater confidence" that inflation is coming fully under control and"instead indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said during a panel discussion at the Wilson Center.
The Fed chair's comments suggested that without further evidence that inflation is falling, the central bank may carry out fewer than the three quarter-point reductions its officials had forecast “Powell’s comments make it clear the Fed is now looking past June,” when many economists had previously expected rate cuts to begin, Krishna Guha, an analyst at EvercoreISI, said in a research note.and that the economy is still growing robustly. Year-over-year inflation rose to 3.5% in March, from 3.2% in February. And a closely watched gauge of “core” prices, which exclude volatile food and energy, rose sharply for a third straight month.
Jefferson said he expected inflation to continue to slow this year with the Fed’s key rate “held steady at its current level.” But he omitted a reference to the likelihood of future rate cuts that he had included in a speech in February.
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Fed's Powell: Elevated inflation will likely delay rate cuts this yearFederal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
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Fed's Powell: Elevated inflation will likely delay rate cuts this yearFederal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
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Fed's Powell: Elevated inflation will likely delay rate cuts this yearFederal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
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Fed's Powell: Elevated inflation will likely delay rate cuts this yearFederal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
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Fed's Powell: Elevated inflation will likely delay rate cuts this yearFederal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year.
Read more »