new video loaded: Fed Won’t Raise Interest Rates Anytime Soon, Says Powell
Fed Won’t Raise Interest Rates Anytime Soon, Says Powell
Jerome H. Powell, Chairman of the Federal Reserve, said the US economy was far from recovery and the central bank would not raise interest rates anytime soon.
The economy is far from our targets and, as I have mentioned a few times, we are strongly committed to adopting a framework for using our monetary policy tools until the job is well and truly done. When the time comes to raise interest rates, we will certainly do so during that time. By the way, it’s not the time anytime soon. Remember we are a long way from maximum employment. There is a lot of slack in the job market. Wage pressures are unlikely to rise to a level that would create – sustain higher inflation. Second, the other factor that I would like to point out is looking around the world, the shortage of demand in many large, advanced economy countries around the world with – which started this crisis at deeply negative interest rates and who had little leeway with interest. rates. Now, there are other things they can do, and they are doing, but this is all going to last a while. And the US economy is highly integrated with the rest of the world. And it’s going to matter. Surveys now show that market participants expect us not to raise rates until inflation hits 2 percent, and the labor market is strong. And that is also in line with our rate forecast. I am optimistic about the economy for the next two years. I really have, and we have to get through this very difficult time this winter with the spread of Covid. But as vaccines come out and we get Covid under control, there are plenty of reasons to be optimistic about the U.S. economy.
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