Powell: Fed to keep rates higher for longer to cut inflation

[mystery-ak]

Powell: Fed to keep rates higher for longer to cut inflation
By CHRISTOPHER RUGABER

WASHINGTON (AP) — The Federal Reserve will push rates higher than previously expected and keep them there for an extended period, Chair Jerome Powell said Wednesday, in remarks likely intended to underscore the Fed’s single-minded focus on combating stubborn inflation.

Powell also signaled in a written speech to be delivered to the Brookings Institution that the Fed may increase its key interest rate by a smaller increment at its December meeting, only a half-point, after four straight three-quarter point hikes. But Powell also stressed that the smaller hike shouldn’t be taken as a sign the Fed will let up on its inflation fight anytime soon.

“It is likely that restoring price stability will require holding (interest rates) at a restrictive level for some time,” Powell said. “History cautions strongly against prematurely loosening policy.”

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https://apnews.com/article/inflation-business-prices-jerome-powell-government-and-politics-9e7fed8f82ffbe9af205ec969e6277af?utm_source=homepage&utm_medium=TopNews&utm_campaign=position_09

[Free Vulcan]

Meanwhile, economic reports of late do not look good. Given the China situation, we could be looking at 70's style stagflation.