Washington: Federal Reserve Chair Jerome Powell sought Wednesday to strike a delicate balance at a moment when high inflation is bedeviling the nation’s economy and commanding a central role in the midterm elections.
Powell suggested that the Fed may decide in the coming months to slow its aggressive interest rate increases. Yet he also made clear that the Fed isn’t even close to declaring victory in its fight to curb an inflation rate that is near four-decade highs and has shown few signs of ebbing.
It was the central bank’s sixth rate hike this year — a streak that has made mortgages and other consumer and business loans increasingly expensive and heightened the risk of a recession.
The statement the Fed issued suggested that it would begin to take a more deliberate approach to rate hikes, likely leading to smaller increases in borrowing costs. In doing so, it would consider that rate hikes take time to feed into the economy and achieve their goal of slowing inflation.