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The message the Federal Open Market Committee sent at its meeting last week was that “the process of de-inflation has begun,” Federal Reserve Chairman Jerome Powell said Tuesday in a controlled question and answer session. browse at the Economy Club of Washington, D.C.
This process may take “a long period of time” and may not be smooth. The better-than-expected January jobs report “shows you why this is going to be a process that will take a long time,” he said.
Powell said he doesn’t expect inflation to drop to the Fed’s 2% level until around 2024.
He declined to say whether the FOMC would raise rates by more than 25 basis points if it knew the January employment numbers at last week’s meeting.
Powell reiterated that the central bank is likely to raise rates more in the process. The three major US stock averages all spiked at 12:48 PM ET. S&P +0.7 %Nasdaq +1.0%and the Dow +0.3%.
Last week, the Federal Open Market Committee raised the benchmark 25 basis points increase to 4.50%-4.75%, down from a 50 bp increase in December and four consecutive 75 bp increments.
In development… check back for updates.
Earlier, Minneapolis Fed President Neel Kashkari said he had not seen any reason to lower the scale path.
