Federal Reserve Chair Jerome Powell reiterated that policymakers need to see more evidence that inflation has subsided before they cut interest rates.
Federal Reserve Chair Jerome Powell on Wednesday stressed the need for more evidence that inflation is subsiding before policymakers move to cut interest rates. "On inflation, it is too soon to say whether the recent readings represent more than just a bump," Powell said in prepared remarks ahead of a question-and-answer session at Stanford University.
In the span of just 16 months, interest rates surged from near zero to above 5%, the fastest pace of tightening since the 1980s. Fed officials are now grappling with when they should take their foot off the brake. Powell said officials are trying to balance the risks between cutting interest rates too soon, which risks setting off inflation again, or waiting too long to cut rates, which could weigh on the economy and possibly trigger a recession.
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