Powell Says He Can’t Promise a ‘Soft Landing’ and Avoid Recession as Fed Fights Inflation

Contact Your Elected Officials
The Epoch Times Header

Federal Reserve Chair Jerome Powell said Thursday that persistent supply chain disruptions and “huge” geopolitical events happening around the globe could foil the Fed’s attempts at engineering a so-called “soft landing” for the U.S. economy, with the central bank chief’s statement amounting to an acknowledgment of the possibility of a recession.

Powell made the remarks in an interview on NPR’s “Marketplace,” in which he was asked whether he’s more concerned about the prospect of high inflation sticking around or the notion that the Fed’s monetary tightening response to surging prices could spark a recession.

“It’s a very challenging environment to make monetary policy,” Powell replied. “Our goal, of course, is to get inflation back down to 2 percent without having the economy go into recession, or, to put it this way, with the labor market remaining fairly strong.”

Calling price stability the “bedrock” on which the economy rests, Powell insisted that the Fed’s key objective is to tame runaway prices, saying that “nothing in the economy works” unless inflation is reined in.

‘Prepared to Do More’

Powell reiterated his expectation that the Fed would tighten monetary settings by hiking rates by 50-basis-point increments over the next two meetings but added that the central bank is prepared to act more aggressively if conditions warrant.

“We have a series of expectations about the economy. If things come in better than we expect, then we’re prepared to do less. If they come in worse than when we expect, then we’re prepared to do more,” Powell said, prompting a question about whether the Fed would consider a 75-basis-point hike, which he declined to do, saying only that policymakers would “adapt to the incoming data and the evolving outlook.”

Powell was then asked about a pathway to “this mythical soft landing,” where the policy tightening doesn’t tip the economy into a recession.

“It will be challenging, it won’t be easy,” Powell replied, admitting that it “would have been better” to have started raising rates earlier than in March.

Soft Landing

Addressing challenges, the Fed chief said that monetary policy can cool surging demand, which is part of the inflationary puzzle, but that the central bank has no tools to address supply-side factors.

By Tom Ozimek

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

The Very British Stalemate: British Politics Explained for Americans

The assumption in the minds of American commentators, politicians, and analysts is that the UK has "gone to the dogs" with "woke" political ideology.

NFL Vikings Male Cheerleader Controversy  

The NFL under the leadership of Roger Goodell is back to yet another controversy that is causing backlash and a possible boycott.

Euronews Is Euro-Trash: Lessons in Media Deception Tactics

Euronews “covered” the vicious murder of a 17-year-old Dutch girl by so-called asylum seeker who raped another girl, calling him simply a “22-year-old man.”

The Woke Left Goes Lock, Stock And Cracker Barrel

Another legendary American institution has been targeted by woke leftists. This time it is the popular family restaurant chain, Cracker Barrel, founded in 1969.

‘Indigenous Drag Story Hour’: A Back-to-Public-School Treat For the Kids

I gave leading child-grooming outfit Drag Queen Story Hour my email to solicit me for funds to convert more public school kids into trannies.

Democrats Map Strategy and Urge Unity ’to Win Elections, Not Arguments’

DNC Chair Ken Martin called upon fellow Democrats to prioritize results over rhetoric as party opened its summer meeting in Minneapolis on Aug. 25.

Federal Reserve Signals Rate Cut—What This Means for Your Money

In Jackson Hole keynote address Fed Chair Powell stated current conditions, a deteriorating labor market, “may warrant” a change in monetary policy.

Netflix Unveils Opening Dates for Philadelphia, Dallas Entertainment Venues

Opening this fall in Philadelphia and Dallas, the Netflix House complexes will feature themed experiences and a restaurant inspired by Netflix content.

Texas Democrats Take Center Stage at DNC Summer Meeting Amid Redistricting Battles

Texas Democrats got a heroes’ welcome on opening day of the Democratic National Committee’s summer meeting in Minneapolis.

Trump Floats New Meeting With Kim Jong Un as South Korea’s Lee Visits White House

President Trump welcomed South Korea’s new president, Lee Jae Myung, to the White House to discuss trade, investment, and defense collaboration.

Trump Signs Order Targeting American Flag Burning, Desecration

President Trump signed an EO that directs the attorney general to prosecute those caught burning the American flag or desecrating it in other ways.

Trump Signs Executive Orders Aimed at Ending Cashless Bail

Trump signed two EOs aimed at eliminating cashless bail, along with order adding specialized law enforcement units to executive agencies in Washington.

Airbnb Co-founder to Redesign Thousands of US Government Websites

Airbnb co-founder Joe Gebbia is honored to redesign thousands of U.S. government websites after he was appointed as Trump’s new design chief.
spot_img

Related Articles