Powell says US economy in 'strong shape', validates expectations for Fed rate hikes
By Alexander Bueso
Date: Wednesday 29 Jun 2022
(Sharecast News) - Federal Reserve chairman Jerome Powell believed his country's economy was in "strong shape" and that inflation could be brought back to target without undermining the solid jobs market.
Nonetheless, he conceded that the job had become more challenging in recent months.
Speaking at the European Central Bank's policy forum in Sintra, Portugal, he also said that "overall the US economy is well positioned to withstand tighter monetary policy," Bloomberg reported.
At the same time, he stressed that "we will not allow a transition from a low inflation environment to a high inflation environment."
Powell also reportedly validated financial markets' pricing for Fed policy, saying that expectations for interest rate increases were "pretty well aligned with where we´re going" and that the Fed was aiming to enter "restrictive territory fairly quickly".
The central banker reiterated that the economy was "quite different" than prior to the pandemic, even as he told his audience that "we will not allow a transition from a low inflation environment to a high inflation environment."
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