Powell signaled Thursday that more rate hikes could be coming as inflation remains high.
“Inflation is still too high, and a few months of good data are only the beginning of what it will take to build confidence that inflation is moving down sustainably toward our goal,” Powell warned in prepared remarks at the Economic Club of New York on Thursday.
The Fed’s preferred inflation gauge fell to 3.5 percent in August from its 7.1 percent peak in June 2022. More data for September will be published Oct. 27, and it’s estimated to remain above the Fed’s 2 percent inflation mandate.
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The Fed has raised rates to their highest level in more than two decades, to a range of 5.25 to 5.5 percent, as it fights to bring inflation back to that target without triggering a recession.
- At the same time, high interest rates have pushed mortgage rates to their
highest level in more than two decades and credit card rates are crunching balance-carrying cardholders.
While Powell said he was encouraged by evidence that inflation and the labor market cooled this summer, he also warned “the path is likely to be bumpy and take some time.”
“The world counts on us to deliver low and stable inflation, that’s what we have to do,” Powell said. “We know that [higher interest rates are difficult for everybody], but ultimately, what we want to get back to is a long period of price stability.”
The Hill’s Taylor Giorno digs more into this here.
