Powell faces historic challenges at the helm of the Federal Reserve: alarms about economic overheating and the game of interest rate cuts
As the U.S. economy stands at the crossroads of prosperity and recession, Federal Reserve Chairman Powell is facing the most severe test of his career. In the complex chess game of inflation and recession warnings, how can the central banker balance the policy scale? This article will deeply analyze this monetary policy game that affects the nerves of the world.
[The decision of the century at the crossroads of monetary policy]
At the interest rate meeting on March 18-19, which affected the nerves of global capital, the Federal Reserve is likely to maintain the benchmark interest rate range of 5.25%-5.50%. But what really caused the market earthquake was the new judgment of the economic outlook by Powell's team. Faced with the contradictory data of the continued hot consumer market and weak manufacturing indicators, the Federal Reserve embedded a "flexible response mechanism" in its policy statement for the first time - promising that if there is a systemic risk in the job market, it will immediately launch an emergency interest rate cut plan.