Federal Reserve Chair Jerome Powell emphasized the importance of the central bank’s independence in setting interest rates without government interference during a speech at the New York Times’ DealBook summit. Powell addressed concerns about President Trump’s criticism of the Fed and reiterated the Fed’s commitment to serving all Americans rather than a political party or specific outcome.
Powell expressed confidence in Congress’s support for the Fed’s independence, stating that he is not worried about any threats to the central bank’s statutory autonomy. He also discussed the Fed’s strategy of cautiously cutting interest rates to achieve maximum employment and price stability for the benefit of the economy.
While some Fed officials have indicated a willingness to further lower interest rates, Powell emphasized the need for careful consideration based on economic data. Christopher Waller mentioned a possible rate cut at the next meeting, while Mary Daly supported the idea of reducing rates but did not commit to a specific timeline.
The Fed’s goal is to deliver a “soft landing” for the economy by managing interest rate increases to reduce inflation without causing a recession. Powell noted that the economy is largely on track for this outcome, despite recent fluctuations in the job market and inflation rates.
Overall, the Fed remains focused on making decisions that will benefit the economy as a whole and maintain stability while navigating the complexities of managing interest rates in a challenging economic environment.
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