US Federal Reserve Chair Jerome Powell said the central bank’s goal of containing the inflation at the 2 percent target has a long way to go. He spoke at a post-Fed meeting press conference to deliver his remarks on the state of the US economy and the forecast for upcoming months.
Powell began his speech by saying the full effects of the ongoing monetary policy tightening are yet to be seen in the economy.
The central bank’s Federal Open Market Committee (FOMC) on Wednesday delivered a 25 bps rate hike decision, much to the expectation of the financial markets. Thanks to the market-wide anticipation of the rate hike this time around, stock indices S&P 500 and Nasdaq, as well as the Bitcoin price showed little volatility after the decision was delivered on Wednesday.
More importantly, Powell said the Fed had not made a decision about any future FOMC meetings when asked about plans for further rate hikes.
Stating that the Fed would be careful about considering the inflation reading alone when deciding on the rates, the Fed Chair explained that the FOMC would prefer to look at the totality of data with a particular focus on inflation.
Inflation Remains Elevated: FOMC
Earlier, the FOMC stated that the US economic activity has been expanding at a moderate pace in recent times. It said the job gains have been robust and unemployment rate remained low while inflation remains elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run, it said. Accordingly, the committee decided to raise the target range for the federal funds rate to 525 to 550 bps, while remaining highly attentive to inflation risks.