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Fed’s Powell voices comfort with present rate stance

Fed’s Powell voices comfort with present rate stance

Mubasher: US Federal Reserve Chairman Jerome Powell on Wednesday said that the central bank is unlikely to make policy move anytime soon as long as the economy sustains its current path.

In prepared remarks to the Joint Economic Committee of Congress, Chair Powell reconfirmed that the Fed’s policy moves this year towards a more accommodative monetary policy approach helped keep the world’s biggest economy on a growth trajectory.

“We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market, and inflation near our symmetric 2% objective,” Powell said.

The Fed delivered its third cut to its benchmark policy rate this year at its October meeting, with the current target range of 1.5% to 1.75%.

“Looking ahead, my colleagues and I see a sustained expansion of economic activity, a strong labor market, and inflation near our symmetric 2% objective as most likely,” the Wednesday remarks said.

Expecting inflation to rise substantially, Powell stated that policymakers will continue to weigh the necessary moves to be made.

“We will be monitoring the effects of our policy actions, along with other information bearing on the outlook, as we assess the appropriate path of the target range for the federal funds rate,” he said.

Markets are currently focused on Powell’s testimony before the Joint Economic Committee.