AFP
Federal Reserve Chair Jerome Powell said Friday inflation remains too high in the U.S. and the central bank is prepared to raise rates further if appropriate.
In a speech at the Federal Reserve Bank of Kansas City’s annual Economic Policy Symposium in Wyoming, Powell shared a brief outlook of the national economy and his assessment of the Fed’s mission to bring year-over-year inflation down to 2%.
Powell said the unwinding of coronavirus pandemic-related supply challenges and the effects of the Fed’s monetary policy changes are starting to show results in driving down inflation. However, “the process still has a long way to go, even with the more favorable recent readings,” he said.
“The lower monthly readings for core inflation in June and July were welcome, but two months of good data are only the beginning of what it will take to build confidence that inflation is moving down sustainably toward our goal,” Powell said. “We can’t yet know the extent to which these lower readings will continue or where underlying inflation will settle over coming quarters.”
Powell reviewed how the Fed’s policy, and other economic factors, are affecting the housing market, demand for durable goods, and the the job market.
Going forward, he said the Fed and the Federal Open Markets Committee will continue to assess all the data and “will proceed carefully” as it considers whether to raise rates again or to “hold the policy rate constant and await further data.”
“Restoring price stability is essential to achieving both sides of our dual mandate. We will need price stability to achieve a sustained period of strong labor market conditions that benefit all,” Powell said. “We will keep at it until the job is done.”






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