Fed, Powell: “The rate hike is premature, inflation will stay high longer than expected”
There Central Bank of the United States it is “on track” to start reducing its asset purchases, but believes that inflation remains high at least until next year when the pressures due to the pandemic. To reveal it, the president of the Fed, Jerome Powell, in an online conference.
“THE constraints of the offer And inflation high will likely last longer than previously predicted and into next year, and the same goes for the pressure on wages, “he said. Powell, adding that a rate hike, albeit now premature, it is not excluded if “we should see a risk of inflation that moves persistently upward” and “well beyond” the objective of the Fed. If the rise becomes structural, he added, “we would definitely use our tools”.
“High inflation it will likely last until well into next year, but we still expect inflation to return close to the 2% target. It is now well above our target, ”Powell added, admitting that it will last longer than initially anticipated.
Furthermore, the number one of the Fed is speaking at an event expected by analysts because it will be his last public speech before the meeting on November 2-3, when the US central bank could herald the start of the tapering, or the reduction of the bond purchase program launched to support the economy during the crisis.
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