Federal Reserve Chairman expects inflation to keep dropping amid increasing price pressures
Date
5/15/2024 3:47:18 AM
(MENAFN) US Federal Reserve Chairman Jerome Powell expressed expectations for inflation to continue its downward trajectory until the end of 2024, mirroring last year's trend. However, his confidence in this prediction has waned following a faster-than-anticipated rise in prices during the first quarter of the year. Speaking at a banking event in Amsterdam, Powell remarked, "I expect inflation to decline again... on a monthly basis to levels that are very similar to the low readings we saw last year... I would say that my confidence in that is not as high as it was."
Despite this tempered confidence, Powell indicated that the Fed is unlikely to need to raise interest rates further. He reiterated the central bank's stance of being "patient" and allowing the current interest rate levels to fully exert their intended impact. Powell stated, "I do not think it is likely, based on the data available to us, that our next step will be to raise interest rates... Most likely... we will keep the interest rate as it is." He acknowledged the challenges ahead, noting, "We did not expect the road to be easy."
Powell's comments were made shortly after new data revealed that producer prices increased more rapidly than expected in April, potentially signaling growing pressure on consumer prices. This data has contributed to the ongoing scrutiny of inflation trends and the Fed's policy responses.
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