Fed Chair Jerome Powell made it clear during a speech at the NABE conference that FOMC is “not a committee that feels like it is in a hurry to cut rates quickly.”
Powell noted that if the economy evolves as expected, Fed could enact “two more cuts” by the end of the year, reducing the policy rate by an additional half a percentage point. He reaffirmed that the US economy is on track for a continued slowdown in inflation, which should allow the Fed to reach a neutral interest rate level “over time.”
“Disinflation has been broad-based,” Powell said, citing recent data that shows progress towards Fed’s 2% inflation target.
However, Powell stressed that Fed is “not on any preset course” and will assess risks on both sides of the economy. “We will continue to make our decisions meeting by meeting,” he added.
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