Fed Chair Powell's Testimony Demystified

London: 10 July 2024 (TraderMade): In a crucial testimony before Congress, Federal Reserve Chair Jerome Powell highlighted significant strides in curbing inflation but cautioned against expecting imminent rate cuts. Powell aims to sustain economic stability while addressing persistent inflationary pressures.

Inflation Progress Celebrated

Powell emphasized the Fed's success in tempering inflation, attributing this progress to steadfast monetary policy measures. "We have seen substantial progress in bringing inflation down," Powell stated, acknowledging collective efforts.

The US dollar firmed up following his testimony, reflecting market confidence in the Fed's strategy. However, Powell stressed that inflation has yet to reach the desired target.

No Rate Cuts in Sight

Despite advancements in controlling inflation, Powell was clear about their stance on interest rates, dispelling any notions of impending cuts. "We are not at a point where rate cuts are appropriate," he asserted.

Powell highlighted the need to maintain a cautious approach to ensure long-term economic health, advising investors to adjust their expectations accordingly. The Fed remains committed to promoting maximum employment and stabilizing prices.

Conclusion

Fed Chair Jerome Powell'sPowell's testimony reaffirmed the Federal Reserve'sReserve's commitment to a measured approach. With significant progress in combating inflation, the Fed's focus remains on maintaining stability and ensuring sustainable growth, while rate cuts remain off the table for now.

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