(The Center Square) – Federal Reserve Chair Jerome Powell said Wednesday that the Fed has seen improvements in their goals of achieving low unemployment rates and combating rising inflation during a news briefing on Wednesday.
“The labor market has come into better balance and the unemployment rate remains low,” Powell said. “Inflation has eased substantially from a peak of 7% to 2.5%. We are strongly committed to returning inflation to our 2% goal in support of a strong economy that benefits everyone.”
Powell went on to say that the Fed have decided to leave their policy interest rate unchanged as of now.
Powell said that rate cuts “could be on the table” when asked by a reporter but explained that he would not have answers until the Fed’s upcoming meeting scheduled for September.
Powell later said that the Fed is “attentive to risks” on either side of their dual mandate.
Powell repeatedly promised during the news conference that the Fed is striving to get inflation down to their goal of 2%.
When Powell was asked about the dual mandate, he responded that the Fed is “balancing” the risks associated with having a dual mandate.
“We are actually in a good place here,” Powell said. “We are balancing these two risks of go too soon and you undermine progress on inflation, wait too long or don’t go fast enough and you put at risk the recovery. And so we have to balance those two things, that’s the nature of having two mandates.”
Labor market data is showing progress toward normalization, according to Powell.
“So, I think the data we have been seeing in the labor market are broadly consistent with that normalization process,” Powell said. “Again, we are closely monitoring to see whether it starts to show signs that it is more than that.”
Powell went on to say that the U.S. labor market is less “overheated” now than it used to be and is now at “more normal conditions.”
He added that they have seen “significant movement” in the labor market and emphasized progress during the news briefing.
“We are seeing progress on inflation,” Powell said.
Powell also cited significant progress in inflation rates compared to this time last year.
“And if you look at the situation of the economy a year ago, inflation was over 4%,” Powell said. “It was a completely different economy.”
Powell said that the current U.S. economy is now more “normalized” but later added that “the job is not done” when talking about tackling inflation.
