US Federal Reserve Chair Jerome Powell Hints at Possible Interest Rate Cut in September
New Delhi [India], August 1: U.S. Federal Reserve Chair Jerome Powell hinted at a possible interest rate cut in September if economic conditions align with expectations. The Fed made these remarks during the latest Federal Reserve meeting which decided to keep the federal funds rate unchanged at 5.25% to 5.5% for the eighth time.
“I think it is a difficult judgement to make it and what you see is the judgement of the committee is that that time is drawing near, that time could be in September if you know that the date supports it,” said Jerome Powell. He also noted that the recent data indicates economic activity in the U.S. has continued to expand at a solid pace.
The committee reaffirmed its commitment to achieving maximum employment and a long-term inflation rate of 2%. Powell added that the committee is carefully assessing incoming data, evolving economic conditions, and the balance of risks. “The job is never done we are watching to see, which way the economy heads and I think if we are to respond to weakness, we are certainly well equipped to do that but that’s not what we are saying we are saying that there a strong economic activity good labour market and inflation coming down,” said Powell.
The Fed remarked that the U.S. economy is growing at a solid pace, and the Fed committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the inflation target. It added that the committee will take into account a wide range of information, including readings on labour market conditions, inflation pressures and inflation expectations, and financial and international developments.
“We don’t see any reason to think this that this economy is overheating or shortly weakening that’s not in the day right now, what’s in the day right now is the economy that is growing at a solid pace, a labour market that has cooled off but none the less unemployment is low in a day over long show strong labour market” added Powell.
Doubts Revealed
US Federal Reserve -: The US Federal Reserve, often called the Fed, is like the central bank of the United States. It helps manage the country’s money and keeps the economy stable.
Jerome Powell -: Jerome Powell is the person in charge of the US Federal Reserve. He makes important decisions about money and the economy in the United States.
Interest Rate Cut -: An interest rate cut means that the cost of borrowing money from banks becomes cheaper. This can help people and businesses spend more money, which can boost the economy.
Federal Funds Rate -: The federal funds rate is the interest rate at which banks lend money to each other overnight. It influences other interest rates in the economy, like those for loans and savings.
Labor Market -: The labor market is where people look for jobs and employers look for workers. A strong labor market means there are many jobs available and people are working.
Inflation -: Inflation is when the prices of things we buy go up over time. If inflation is too high, things become too expensive; if it’s too low, it can hurt the economy.
Maximum Employment -: Maximum employment means that almost everyone who wants a job can find one. It’s one of the goals of the US Federal Reserve to keep the economy healthy.
Long-term Inflation Rate of 2% -: A long-term inflation rate of 2% means that the Fed wants prices to go up by about 2% each year. This helps keep the economy stable and predictable.