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The President of the Federal Reserve (Fed) of the United States, Jerome Powell, said on Tuesday that inflation in the American economy is starting to slow down, although it is expected to be a long process, reports CNBC.
The President of the Federal Reserve, Jerome PowellPhoto: Jess Rapfogel/AP/Profimedia
“The disinflationary process, the process of reducing inflation, started and started in the goods sector, which represents regarding a quarter of our economy. But he has a long way to go. These are the early stages,” the head of the central bank said during an event in Washington, DC
Powell spoke in a question-and-answer session at the Economic Club of Washington, DC, with Carlyle Group co-founder David Rubenstein.
Powell is a former partner at that firm.
Markets returned to a positive trend as Powell spoke, as investors hope the Fed will soon halt the aggressive key interest rate hikes it began last year.
At the Fed’s most recent policy meeting, which ended six days ago, the Fed raised its benchmark interest rate by a quarter of a percentage point, the eighth increase since March 2022, to a target range of 4.5% -4.75%.
In his remarks on Tuesday, Powell gave no indication of when interest rate hikes would stop and said it would likely take until 2024 before inflation reaches a point the Fed is comfortable with.
The central bank targets an inflation of 2%, and currently the indicator far exceeds this level, by several measures.
“We expect 2023 to be a year of significant slowdowns in inflation. It’s actually our job to make sure that’s the case. I suspect that it will definitely take not only this year, but also next year to decrease by almost 2%”, he said.
Powell’s first mention of “disinflationary” trends was in the press conference following the meeting last Wednesday.
(source: news.ro)