Powell says Federal Reserve is more confident inflation is slowing to its target
“We've had three better readings, and if you average them, that's a pretty good pace," Powell said of inflation in a question-and-answer question at the
Powell declined to provide any hints of when the first rate cut would occur. But most economists foresee the first cut occurring in September, and after Powell's remarks
“Today," Powell said, “I'm not going to send any signals on any particular meeting.”
Rate reductions by the Fed would, over time, reduce consumers’ borrowing costs for things like mortgages, auto loans, and credit cards.
Last week, the government reported that consumer prices declined slightly from May to June, bringing inflation down to a year-over-year rate of 3%, from 3.3% in May. So-called “core” prices, which exclude volatile energy and food costs and often provide a better read of where inflation is likely headed, climbed 3.3% from a year earlier, below 3.4% in May.
In his remarks Monday, Powell stressed that the Fed did not need to wait until inflation actually reached 2% to cut borrowing costs.
“If you wait until inflation gets all the way down to 2%, you've probably waited too long,” Powell said, because it takes time for the Fed's policies to affect the economy.
Powell also commented on the attempted assassination of former President
After several high inflation readings at the start of the year had raised some concerns, Fed officials said they would need to see several months of declining price readings to be confident enough that inflation was fading sustainably toward its target level. June was the third straight month in which inflation cooled on an annual basis.
After the government’s latest encouraging inflation report Thursday,
In a call with reporters, Daly struck an upbeat tone, saying that June’s consumer price report showed that “we’ve got that kind of gradual reduction in inflation that we’ve been watching for and looking for, which ... is actually increasing confidence that we are on path to 2% inflation.”
Many drivers of price acceleration are slowing, solidifying the Fed’s confidence that inflation is being fully tamed after having steadily eased from a four-decade peak in 2022.
Thursday’s inflation report reflected a long-anticipated decline in rental and housing costs. Those costs had jumped in the aftermath of the pandemic as many Americans moved in search of more spacious living space to work from home.
Hiring and job openings are also cooling, thereby reducing the need for many businesses to ramp up pay in order to fill jobs. Sharply higher wages can drive up inflation if companies respond by raising prices to cover their higher labor costs.
Last week before a
Uniswap vs SEC Power Struggle Cannot Deter DEXs Away From Their Privacy Mandates
Gold Analysis: The Trend Permits Further Gains – 15 July 2024
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News