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Fed Hit the Gas Before the Election—Now Powell Is Pumping the Brakes

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mystery-ak:
John Carney 11 Feb 2025

Federal Reserve Chair Jerome Powell told lawmakers Tuesday that the central bank sees little urgency to lower interest rates, citing a resilient labor market and lingering inflation risks.

The comments reinforced expectations that the Fed will keep rates steady at its next meeting, despite having aggressively cut rates last year when economic conditions appeared softer.

“With our policy stance now significantly less restrictive than it had been and the economy remaining strong, we do not need to be in a hurry to adjust our policy stance,” Powell said in prepared remarks to the Senate Banking Committee, kicking off two days of testimony before Congress.

Optimism Rises as Economy Outperforms Fed Expectations

The Fed’s stance comes as economic confidence has climbed in response to the election Donald Trump, bolstered by steady job growth and strong consumer spending. Since President Donald Trump’s election victory in November, markets have rallied, and business sentiment has improved, reversing concerns that dominated much of 2024.

Powell acknowledged that labor market conditions remain better than Fed officials had projected last year. The unemployment rate ticked down to 4 percent in January, and job gains have averaged 189,000 per month over the past four months—stronger than the cooling trend many economists had expected. Wage growth has also moderated without triggering a surge in layoffs, a combination Powell described as evidence of a “broadly balanced” labor market.

At the same time, inflation progress has slowed, a development Powell suggested justifies the Fed’s pivot to a more patient stance. The personal consumption expenditures (PCE) price index—the Fed’s preferred inflation gauge—stood at 2.6 percent in December, down from a 7.2 percent peak in 2022 but still above the central bank’s 2 percent target.

more
https://www.breitbart.com/economy/2025/02/11/fed-hit-the-gas-before-the-election-now-powell-is-pumping-the-brakes/

DefiantMassRINO:
Much of the inflationary pressures in the economy are due to lack of supply (housing), misallocation of supply (corn for ethanol), or supply disruptions (bird flu).

Lower rates and a weaker dollar are beneficial to exports, but, no nation has devalued its way to prosperity.

America needs to improve efficiencies and grow GDP.  This requires Government policy to encourage long-term investment and risk-taking.

The Fed's monetary policies alone will not restore America to free market economic sanity.

The biggest obstacle to progress, growth, and prosperity is Government.  America needs de-regulation at the local, state, and Federal levels.

Drago:
That and stop deficit spending/inflating the money supply. Need about $2 Trillion cut out of the Fed budget (balanced + a bit extra for debt reduction)...I don't think "DOGE" has a prayer of getting to that number. Protect yourself, gold, silver, Bitcoin, commodities, .22 LR, etc.. I am going to add a few of these to my stash:

https://www.goldback.com

Hoodat:

--- Quote from: DefiantMassRINO on February 11, 2025, 01:48:44 pm ---Much of the inflationary pressures in the economy are due to lack of supply (housing), misallocation of supply (corn for ethanol), or supply disruptions (bird flu).

--- End quote ---

The lone cause of inflation is expansion of the money supply.

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