#PowellRemarks

Federal Reserve Chair Jerome Powell recently delivered remarks on the economic outlook at the Economic Club of Chicago. Here are the key points:

- *Economic Outlook*: Despite uncertainty and downside risks, the US economy remains solid, with the labor market near maximum employment. Inflation has decreased significantly but still runs above the 2% objective.

- *Inflation*: Recent readings show total PCE prices rose 2.3% over the 12 months ending in March, while core PCE prices increased 2.6%. Powell emphasized the need to keep longer-term inflation expectations anchored.

- *Monetary Policy*: The Fed will balance maximum employment and price stability mandates. Powell noted that tariffs could lead to higher inflation and slower growth, and the Fed will adjust policy accordingly.

- *Tariffs and Trade Policy*: The level of tariff increases announced is larger than anticipated, and the economic effects, including higher inflation and slower growth, will be closely monitored.

- *Labor Market*: Nonfarm payrolls grew by an average of 150,000 jobs per month in the first quarter, with low layoffs and stable unemployment rates.

Powell's remarks highlight the Fed's cautious approach to monetary policy, prioritizing price stability and maximum employment amidst economic uncertainty.¹