Federal Reserve Chair Jerome Powell is expected to offer a darker message this week in the most closely watched speech of his tenure: The fight against spiking prices is far from over
Federal Reserve Chair Jerome Powell’s optimistic words at the annual Jackson Hole conference in 2021 were followed by the biggest sustained surge in prices that the U.S. has seen in four decades. | Manuel Balce Ceneta/AP PhotoFederal Reserve Chair Jerome Powell, who last year reassured Americans that high inflation would likely be temporary, is expected to offer a darker message this week in the most closely watched speech of his tenure: The fight against spiking prices is far from over.
“There are no easy answers,” said Torsten Slok, chief economist at private equity firm Apollo Global Management. “The Fed is very worried about sending the right signal.” “Chair Powell needs to reset market rates expectations, avoid the mishaps of last year, and start to repair the damaged credibility of the institution,” he said.
Still, some Democratic policymakers in Washington want to hear at least a kernel of a plan to begin easing off rate hikes. Sen. argues that the Fed can’t do much about many of the key drivers of high inflation anyway — including supply chain disruptions and higher oil prices — so it should avoid squeezing the economy.