Washington: The US Federal Reserve is in no hurry to adjust its policy stance as the Trump administration’s trade, immigration, fiscal, and regulation policies take shape,” Fed Chair Jerome Powell said Friday. He noted significant changes in these policy areas, particularly trade, but emphasized the persistent high uncertainty surrounding them.
According to Anadolu Agency, Powell spoke at an event hosted by the University of Chicago Booth School of Business, where he emphasized the importance of distinguishing significant information from noise as the economic outlook evolves. Despite the elevated levels of uncertainty, Powell assured that the US economy remains stable, allowing the Fed to wait for greater clarity before making policy adjustments.
Powell highlighted that surveys from households and businesses indicate increased uncertainty regarding the economic outlook. Recent data suggests that consumer spending may moderate, raising questions about how these developments might affect future spending and
investment.
He further noted expected progress in reducing inflation, although it may be uneven. Powell acknowledged that the process of sustainably returning inflation to the Fed’s target has been challenging and anticipated ongoing progress in areas such as housing services and market-based components of non-housing services.
Powell stated that if inflation does not move towards the Fed’s 2% goal, the central bank can maintain policy restraint for an extended period. Conversely, if the labor market weakens and inflation falls more rapidly than anticipated, the Fed may ease monetary policy.