Federal Reserve Chair Jerome Powell recently spoke at the Jackson Hole Economic Symposium, where he outlined the uncertainties surrounding the economic outlook and the possibility of further restrictive monetary policies. Despite inflation having declined from its peak, Powell maintained that it remains excessively high. The Federal Reserve is prepared to raise interest rates further if necessary, and plans to maintain a restrictive policy level until it sees substantial evidence of sustained inflation reduction towards their 2% target.The Fed’s rate hikes have resulted in significantly increased loan rates, making it difficult for Americans to afford homes or cars and for businesses to finance expansions. Despite this, the U.S. unemployment rate remained steady at 3.5%, barely above a half-century low. This persistent inflation and robust employment figures underscore Powell’s concern about the rapid economic growth, indicating a potential need for higher interest rates to act as a restriction.Most traders now foresee no interest rate cuts before mid-2024 at the earliest. Powell noted that the central bank’s policymakers believe their key rate is sufficiently high to restrain the economy and cool growth, hiring, and inflation. However, he acknowledged the difficulty in determining the necessary borrowing costs to slow the economy, resulting in constant uncertainty regarding the effectiveness of the Fed’s policies in reducing inflation. While some are optimistic for a “soft landing”, others remain skeptical.

Information	Details
Geography	North America
Countries	🇺🇸
Sentiment	neutral
Relevance Score	7
People	Jerome Powell, Associated Press
Companies	Federal Reserve, Associated Press, Jackson Hole Economic Symposium, Federal Reserve Chair Jerome Powell, U.S.
Currencies	None
Securities	None