Fed Chair Jerome Powell acknowledged that the latest inflation data released yesterday confirms the US is making progress but is still “not there on inflation.”
Following January’s stronger-than-expected CPI report, Powell said in the Congressional testimony that Fed will “keep policy restrictive for now” to bring price pressures down.
Powell also underlined that the “economy is strong, the labor market is solid” allowing the Fed to keep a tight policy stance and wait for inflation to ease further.
He also emphasized that one month of higher readings should not be interpreted as a complete reversal of the disinflation trend, especially given that Fed’s preferred inflation measure, the Personal Consumption Expenditures index, typically runs below CPI.
