The president of the Federal Reserve (Fed), Jerome Powell, warned that the increase in cases of COVID-19 and the new variant of the coronavirus, omicron, could slow progress in employment and economic growth, in addition to adding a greater “uncertainty”On inflation.
This was indicated in his appearance before the Senate banking committee, in which he was accompanied along with the Secretary of the Treasury, Janet Yellen, at a delicate moment for the US economy with inflation at levels not seen in 30 years in the United States.
“Increased concern about the virus could reduce people’s willingness to work in person, slowing progress on the job market and intensifying problems in supply chains.“Powell said.
As a consequence, he added, “the risks of higher inflation have increased”.
In October, year-on-year inflation stood at 6.2% in the United States, and Powell has insisted that he expects it to moderate starting in mid-2022.
The US central bank has kept interest rates in the range of between 0% and 0.25% since March 2020 to support the economy with the arrival of the pandemic, and then launched a multimillion-dollar monthly bond purchase program, whose gradual withdrawal started this November.
The Fed will hold its last monetary policy meeting of the year on December 14 and 15, in which it will present its new macroeconomic forecasts, which in September set a growth rate of 5.9% and inflation of 4.2% by the end of 2021.
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