Federal Reserve Chairman Jerome Powell announced that the US Federal Reserve will “continue to push” to tighten monetary policy until it becomes clear that inflation is falling back toward a healthy level.
“What we need to see is inflation going down in a clear and convincing way, and we’ll keep pushing until we see that,” Powell said in a seminar organized by the “Wall Street Journal.”
“If we don’t see that, we will have to look at moving more aggressively” to tighten financial conditions, Powell said.
He explained that while the US Reserve will raise interest rates in the upcoming monetary policy meetings, it will evaluate the data in each meeting separately to see how the economy and inflation are going.
Annual inflation in the US is currently over 3 times the Federal Reserve’s 2 percent target.
Federal Reserve officials raised interest rates by half a percentage point in the week before last.
Powell indicated a continuation of the hike at that pace in the meetings scheduled to be held in June and July to curb inflation, and ruled out a larger increase of 75 basis points. He said: “After this increase, similar moves of 50 basis points are likely to come in subsequent meetings as long as economic conditions remain similar to what they are now.”
It is still possible for Powell to be able to achieve inflation targets without hurting the economy.
“You’d still have a strong job market if unemployment rose a few points. I would say there are a number of reasonable paths to get a soft landing as I said a soft landing.”
