Federal Reserve Chair Jerome Powell listens as U.S. Secretary of the Treasury Janet Yellen presides over a gathering of the Monetary Stability Oversight Council on the Treasury Division on Might 10, 2024 in Washington, DC.
Kent Nishimura | Getty Photographs
Federal Reserve Chair Jerome Powell reiterated Tuesday that inflation is falling extra slowly than anticipated and can hold the central financial institution on maintain for an prolonged interval.
Talking to the annual normal assembly of the International Bankers’ Affiliation in Amsterdam, the central financial institution chief famous that the speedy disinflation that occurred in 2023 has slowed significantly this 12 months and brought on a rethink of the place coverage is headed.
“We didn’t anticipate this to be a clean highway. However these [inflation readings] had been larger than I feel anyone anticipated,” Powell mentioned. “What that has instructed us is that we’ll must be affected person and let restrictive coverage do its work.”
Whereas he expects inflation to return down by the 12 months, he famous that hasn’t occurred up to now.
“I do suppose it is actually a query of preserving coverage on the present price for longer than had been thought,” he mentioned.
Nonetheless, he additionally repeated that he doesn’t anticipate the Fed to be elevating charges.
The Fed has been holding its key in a single day borrowing price in a focused vary of 5.25%-5.5%. Although the speed has been there since July, it’s the highest degree in some 23 years.
“I do not suppose that it is seemingly, based mostly on the information that now we have, that that the following transfer that we make can be a price hike,” he mentioned. “I feel it is extra seemingly that we’ll be at a spot the place we maintain the coverage price the place it’s.”
That is breaking information. Please test again for updates.