#PowellRemarks
Jerome Powell, Chair of the Federal Reserve, recently shared his insights on the US economy. Here are some key points from his remarks
- *Economic Outlook*: Powell noted that the US economy has made significant progress toward the Fed's dual-mandate goals of maximum employment and stable prices. He expects inflation to continue to come down toward the 2% objective, albeit on a sometimes-bumpy path.
- *Interest Rates*: The Fed has been reducing policy restraint by lowering interest rates. Powell emphasized that the path for getting there is not preset and will depend on incoming data, the evolving outlook, and the balance of risks.
- *Inflation*: Powell believes that inflation is on a sustainable path to the 2% goal. He highlighted that progress on inflation has been broad-based, with estimates indicating that total PCE prices rose 2.3% over the 12 months ending in October.
- *Labor Market*: The labor market remains in solid condition, with unemployment remaining low. Powell expects strength in the economy and labor market to be maintained with inflation moving sustainably down to 2%.
- *Monetary Policy*: The Fed is committed to finishing the job of bringing inflation down to 2%. Powell emphasized that the risks to achieving employment and inflation goals are roughly in balance.
- *Global Economic Uncertainty*: Powell also discussed the impact of global economic uncertainty, including the effects of tariffs on inflation and supply chains. He noted that businesses and households are experiencing high uncertainty, which can lead to postponed investment and hiring decisions.
In a recent conversation with ,
Powell also touched on ¹:
- *Fed Independence*: Powell emphasized that the Fed's independence is a matter of law and has broad support across both political parties in Washington.
- *Tariffs and Inflation*: Powell noted that tariffs are highly likely to generate at least a temporary rise in inflation, and the Fed's role is to keep inflation expectations well anchored.
