- ORIGINAL NEWS
Powell says the Fed is ‘not far’ from the point of cutting interest rates
- SUMMARY
The Federal Reserve Chair, Jerome Powell, has hinted that the central bank may consider lowering interest rates soon if inflation, the rate of price growth, continues to ease.
Powell indicated that they are close to being confident that inflation is moving towards their target of 2%, and when they attain that level of confidence, they will start reducing interest rates to avoid causing an economic recession.
Currently, financial markets expect the first interest rate cut to occur in June, with four cuts totaling 1% by the end of 2024.
While inflation has been decreasing, it is not yet at the level where the Fed feels comfortable lowering rates.
Powell believes the current policy stance is appropriate, and he is waiting for stronger signals before making adjustments.
- NEWS SENTIMENT CHECK
- Overall sentiment:
positive
Positive
“Federal Reserve Chair Jerome Powell on Thursday indicated that interest rate cuts may not be too far off if inflation signals cooperate.”
“Powell spoke at a time when financial markets have swung considerably in their expectations on Fed policy.”
Negative
“Inflation data recently has indicated the pace of price increases is continuing to slow, though the consumer price index rattled markets when it came in higher than expected for January.”