The Federal Reserve (Fed) will continue to push to tighten US monetary policy until it is clear that inflation is slowing, Fed Chairman Jerome Powell said.
“What we need to see is inflation coming down clearly and convincingly and we’re going to keep pushing until we see that.s”, he assured in an event of the Wall Street Journal.
“If we don’t see that we will have to consider moving more aggressively” to tighten financial conditions.
As it raises rates at upcoming monetary policy meetings, the central bank would assess “meeting by meeting, data reading by data reading” how the economy and inflation behave, he said Powell. Inflation is running at more than three times the Fed’s 2% target.
If the pace of price increases does not slow down, he stated that the fedwhich raised its benchmark rate by three-quarters of a percentage point this year, will not hesitate to raise it to more restrictive levels.
“If that means going beyond widely understood levels of ‘neutral’, we won’t hesitate to do so.”, he assured referring to the rate at which economic activity is neither stimulated nor restricted.
“We’ll go until we feel like we’re in a place where we can say ‘yes, financial conditions are in an appropriate place, we see inflation coming down’”, commented Powell.