June 21 () –
The president of the Federal Reserve of the United States (Fed), Jerome Powell, has affirmed this Wednesday that the estimate shared by the majority of members of the Federal Open Market Committee (FOMC, for its acronym in English) of the Fed that they would be “appropriate” two more rate hikes this year is “a fairly accurate prediction” if the economy performs as expected.
Powell has also assured before the Financial Services Commission of the United States House of Representatives that, in the current context, “taking into account how far it has come” with the increases, it may be appropriate “to raise rates more, but do it at a more moderate pace.
The Fed decided at the last monetary policy meeting on June 14 to keep interest rates in the target range of between 5% and 5.25% after the ten consecutive increases since March 2022.
Powell has insisted that the “uncertain delays with which monetary policy affects the economy and the potential difficulties derived from a tightening of credit” were behind this pause to, thus, “gather additional information” on the consequences of the increases already previously agreed. He has also renewed his intention that the Fed stick to the data when determining future rate hikes.
In addition, Powell has flatly ruled out modifying the 2% target for inflation and has underlined his “firm commitment” to curb inflation, since without price stability it is not possible “to maintain the conditions of a vigorous labor market for a prolonged period “.
