The Fed will not cut interest rates if inflation does not fall

Chairman of the Federal Reserve of the United States (Nourish itJerome Powell warned Tuesday that the institution he leads is prepared for this Maintaining its restrictive monetary policy unchanged in the face of market power Employment and inflation entrenchment.

“If inflation continues to rise, we can maintain the current level of restrictions for as long as necessary. At the same time, we have plenty of room to ease monetary policy “In the event that the labor market unexpectedly weakens,” Powell explained at an economic forum. United State-Canada, in statements compiled by Europe Press.

Moreover, he explained, the latest inflation data did not give the North American Issuing Institute any greater confidence in this Converge in a sustainable way with the goal 2% which actually indicates that it is “likely” that it will take longer than expected to reach the stated level of certainty.

The person responsible for US monetary policy has stated that, given the progress previously made with respect to inflation and…Good progress in the job market for 26 months Consecutive periods with an unemployment rate of less than 4%, “it is advisable to give more time to restrictions and let the data and the evolution of forecasts guide us.”

However, Powell stressed that the performance of the US economy over the past year was “very good” thanks to the improvement on the supply side that favored aggregate demand and employment. This process could have coincided with moderation in inflation, but, as we noted, the price slowdown could have stopped at the beginning of 2024.