Federal Reserve Chair Jerome Powell told lawmakers Tuesday that the central bank sees little urgency to lower interest rates, citing a resilient labor market and lingering inflation risks.
Yet the central bank still cuts its target rate by another 25 basis points. Its explanation isn’t convincing.
The acceleration of inflation since the Federal Reserve cut interest rates in September suggests that the move was a mistake.
An independent agency of government shouldn’t have such enormous power to skew financial outcomes.
Inflation is rising again, and even Federal Reserve cheerleader Bloomberg is worried the Fed is losing the plot.
Inflation rising is awkward for the Fed, given Chairman Jerome Powell already cut rates for the looming recession.
Federal Reserve officials warned at the June policy meeting that if inflation remained elevated or continued to rise, policymakers might need to raise interest rates, according to minutes from the meeting released on Wednesday.
The principle cause of inflation is too much money chasing too few goods. Joe Biden’s massive spending and the Fed’s enabling of that spending is a real inflationary problem, while regulatory and tax threats have smothered small business production. Trump is suggesting his successful economic policies can be repeated if he is re-elected. There’s no empirical reason to doubt him.
Employers in the United States added 272,000 workers to their payrolls in May, the Department of Labor said Friday, likely foreclosing the chances for a rate cut from the Federal Reserve early this summer.
While the Fed chief said that he expects inflation will eventually continue to cool further, he warned that “my confidence in that is not as high as it was, having seen these readings in the first three months of the year.”
The year began with Fed officials awash in optimism. …a string of worse-than-expected inflation reports in the first three months of this year forced the Fed to tear up the script and rewrite this year’s plotline.
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