Fed Chair Powell's Statements in Different Words

Fed Chair Jerome Powell stated that the recent rate cut was a move toward achieving a more balanced monetary policy stance. Here's what he said in alternative wording ¹ ² ³:

- *Not targeting asset prices*: Powell emphasized the Fed isn't aiming to influence financial asset prices like stocks, despite acknowledging they're at relatively high levels.

- *Monitoring markets cautiously*: The Fed is keeping an eye on the market without direct intervention, suggesting investors should be cautious.

- *Inflation updates*: Powell noted that 12-month headline consumer price inflation hit 2.7% in August, and core consumer price inflation was 2.3%, both higher than last year due to commodity prices.

- *Tariffs' impact on inflation*: Powell believes tariffs' inflationary effects will likely be short-term.

Implications

Considering Powell's comments ² ¹:

- *Risk management approach*: Powell described the rate cut as "risk management," balancing the Fed's dual mandate of maximum employment and price stability.

- *Future rate decisions*: The Fed's path forward depends on incoming data, the economic outlook, and risk balance.