new video loaded: Fed Leaves Interest Rates Near Zero Amid Continued Economic Risks
Fed Leaves Interest Rates Near Zero Amid Continued Economic Risks
Jerome H. Powell, the Federal Reserve chair, said on Wednesday that the nation would need to show greater progress toward substantial recovery before policies designed to bolster the economy would be lifted.
Today, my colleagues on the FOMC and I kept interest rates near zero, and maintained our sizable asset purchases. These measures, along with our strong guidance on interest rates and on our balance sheet, will ensure that monetary policy will continue to deliver powerful support to the economy until the recovery is complete. Widespread vaccinations, along with unprecedented fiscal policy actions, are also providing strong support to the recovery. Since the beginning of the year, indicators of economic activity and employment have strengthened. While the recovery has progressed more quickly than generally expected, it remains uneven and far from complete. The path of the economy continues to depend significantly on the course of the virus and the measures undertaken to control its spread. Since March, progress on vaccinations has limited the number of new cases, hospitalizations and deaths, while the level of new cases remains concerning, especially as it reflects the spread of more infectious strains of the virus, continued vaccinations should allow for a return to more normal economic conditions later this year. We continue to expect it will be appropriate to maintain the current 0 to .25 percent target range for the federal funds rate until labor market conditions have reached levels consistent with the committee’s assessment of maximum employment, and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. I would note that a transitory rise in inflation above 2 percent this year would not meet this standard. The economy is a long way from our goals, and it is likely to take some time for substantial further progress to be achieved.
Recent episodes in
News Clips: Business