Fed Chair Jerome Powell acknowledged that recent economic data have not bolstered confidence in disinflation. He signaled the readiness to keep rates elevated for an extended period if inflationary pressure persists.
“Recent data have clearly not given us greater confidence that inflation is coming fully under control. Instead, they indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said at a conference overnight. .
“Given the strength of the labor market and progress on inflation so far, it is appropriate to allow restrictive policy further time to work,” he added.
“If higher inflation does persist, we can maintain the current level of interest rates for as long as needed,” Powell noted.
