Charting Final Step to Tame Inflation: Federal Reserve Chair Powell’s Expected Move

The Federal Reserve Chair Jerome Powell will lay out the final steps in the US central bank’s endeavors to tame inflation and reinforce their commitment to finishing this goal.

Federal Reserve Chair Jerome Powell Will Lay out Steps to Tame Inflation

According to CNBC, Federal Reserve Chair Jerome Powell said during a press conference following the central bank’s July meeting that while there might be a slight weakening in labor market conditions in their efforts to control inflation, the consequences would much more severe if they were unable to tame inflation.

Following this, Fed Chair Powell’s speech last Friday in Jackson Hole Wyo, states his expected move to outline his final steps and effort to tame inflation and strengthen its dedication toward completing the task.

Although the speech might lack the same level of excitement as previous year’s keynotes, Powell’s address at the annual gathering of global central bankers by the Fed is occurring as policymakers venture into what he has labeled the most challenging phase of combating inflation. This phase involves determining the appropriate extent of further tightening measures, all while having limited clarity on the actual impact of their actions on the economy up  until now.

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Federal Reserve Chair Jerome Powell Will Lay out Steps to Tame Inflation -Photo by: (Investopedia)

 Fed Reserve Chair Jerome Powell’s Speech

Throughout this week, there is an anticipation that Powell will take advantage of his platform to clarify the Fed’s approach for determining when it’s necessary to increase interest rates and to pinpoint the suitable timing to begin decreasing them.

Scheduled for Friday morning at 10:05 a.m. Eastern time, Powell is set to deliver an outlook-focused speech during the Kansas City Fed’s annual economic policy symposium, which is held in proximity to the Teton mountain range. In the coming year, the main task will be to skillfully navigate the two-pronged challenge of dealing with inflationary pressures and avoiding economic downturns.

Following Powell’s notably straightforward speech at last year’s conference, where he highlighted the central bank’s determination to suppress inflation, Federal Reserve officials have escalated the benchmark rate to reach its highest point in 22 years, ranging from 5.25% to 5.5%. There haven’t been many signs that tighter monetary conditions are harming the economy, and inflation indicators currently show a notable decline compared to last year. However, as concern over inflation diminishes and other economic risks become more prominent, Federal Reserve officials are becoming increasingly divided into two groups.

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