The Federal Reserve of the United States began this Tuesday the meeting of its Federal Open Market Committee, which will conclude on Wednesday and in which it is expected to study whether to set a date for the anticipated rise in interest rates, currently between 0% and 0, 25%.
At the end of its last meeting in December, the Fed left interest rates unchanged, but accelerated the reduction of its bond purchase program, the economic stimulus that it launched in the face of the crisis caused by COVID-19, and indicated that it plans to eliminate it completely in March.
However, since that meeting in the middle of last month, it has been known that the year-on-year rate of inflation in the United States rose in December to 7%, the highest figure recorded since 1982, which redoubles the pressure on the Fed to be more aggressive in adopting measures to contain price increases.
On recent January 11, Fed President Jerome Powell applied to a Senate committee for a second term as head of the agency and assured that will prioritize the fight against high inflation, even if this means putting less emphasis on the goal of full employment.
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“There is no legal basis to prefer full employment to price stability or vice versa. They are equal. However, at different times, one of them can go further off target and that’s the one we need to focus on a little more,” Powell explained.
“Sometimes it’s full employment and sometimes it’s inflation. I think now it’s inflation,” added the Fed chairman.
Asked about the possibility, pointed out by several central bank governors, that there will be between three and four increases in interest rates throughout 2022, Powell limited himself to answering that the agency will use all the tools at its disposal.
Source: Efe
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