According to PANews, Federal Reserve Chairman Powell said that the Federal Reserve is adjusting its policy framework to respond to changes in the outlook for inflation and interest rates after the epidemic in 2020. Since 2020, the economic environment has changed significantly.
The Fed adopted the current framework five years ago and began reviewing it this year. The review is unlikely to affect the current way interest rates are set and is expected to be completed and announced by August or September. Powell pointed out that the rise in real interest rates after the epidemic may affect the framework elements.
He said higher real interest rates could portend greater inflation instability in the future and more frequent and persistent supply shocks, posing challenges to the economy and the central bank.