head United States Federal Reserve (Feed), Jerome Powellwarned most Business and households will have to endure “some pain” As a toll to overcome the high inflation rates the country has been experiencing for months.
At the traditional summer speech at the monetary policy symposium organized by the Federal Reserve jackson holePowell stated that it failed. reducing price growth “means much more pain.”
“Restoring price stability will take some time and will require us to use our tools vigorously to better balance demand and supply,” Powell said. said.
“Reducing inflation is probably sustainable period of under-trend growth. Also, there will most likely be a relaxation in labor market conditions. Higher interest rates, slower growth and easing working conditions will reduce inflation while also putting some strain on households and businesses.”
The Fed chair reassured that the monetary asset is clearly leading. policies to a “sufficiently restrictive” level. enough to return inflation to the 2% target.
In this sense, Powell argues that restoring this stability is probably a restrictive monetary policy for a certain period of time. He also stressed that historical experience “warns against premature easing of monetary policy”.
In just three months, the Fed has made a series of aggressive rate hikes. It decided to increase the money price by 50 basis points in May and 75 basis points in June and July.
Source: Informacion
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