The US Fed Chair Powell speaks live today pointing out that growth can be slower in dealing with soaring inflation.
He also said at European Central Bank Forum on Central Banking 2022 in Sintra, Portugal that this world has been facing serious issues regarding the economy. Since the pandemic, the economy has been driven by multi forces. We cannot say surely whether we will go back to something that we had before.
Fed Chair Powell speaks live today, “We had a series of shocks in the meantime. The inflation rate is on highs across the world and at the same time we are learning and trying to deal with it”. He also told the title “Challenges for monetary policy in a rapidly changing world”.
Powell repeated that the US economy is much stronger to deal with the higher interest rates.
He was also hopeful during his speech economic growth will remain positive. He said, “The financial position of households is very good, they are still saving excess, and the labor market is also very strong. The US economy is well-maintained to withstand higher interest rates”.
Fed Chair Powell speaks live today “We hope that economic growth will be moderate. This important adjustment must take place so that supply may get better. For the time being, the balance of supply and demand is not equal and we need to balance it in order to bring inflation down”.
With all these aims, Powel also said it is not guaranteed that we will achieve our targets. He called this task challenging as the war in Ukraine has put more inflationary pressures on energy prices.
He also said we are eyeing creating a policy to bring inflation down to 2%.
However, he confessed that increasing interest rates can be risky and rates may go too far but if we fail to restore prices it would be more dangerous.
Fed Chair Powell speaks live today “We have to prevent that from happening faithfully. At any cost we are not going to allow a shifting of low inflation environment to high inflation environment”.