Fed ‘rate hike’ assessment

Powell answered questions from members of the US Senate Committee on Banking, Housing and Urban Affairs on the second day of his presentation on the Semi-Annual Monetary Policy Report to the US Congress.

In response to questions about interest rates, Powell said the Federal Open Market Committee (FOMC) was generally of the opinion that it would be appropriate to raise interest rates again, perhaps twice, this year.

“KNOW MORE TIME…”

Stating that they have come a long way in their tightening policy, Powell said the reason for holding interest rates constant at the last meeting was to give them more time to make a decision.

Remembering that they moved very fast at first, Powell explained that they gradually slowed down. Emphasizing that they are determined to control inflation, Powell said: “We are close, but there is a little more room to raise interest rates.” saying.

FALL EXPECTATION

Stating that they expect the labor market to continue to cool gradually, Powell noted that inflation is also expected to continue its downward movement this year.

“If broadly in line with expectations, a large majority of the Committee believes it would be appropriate to increase the rate once or twice by the end of the year, with the vast majority favoring it twice. So I think the data will tell us what to do.” he said.

Emphasizing that they will do whatever it takes to bring inflation down to 2 percent over time, Powell said they don’t see interest rate cuts coming in the near future. (AA)