October 19, 2021

Dubai Week

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Powell: The Reserve Bank will take action if inflation is higher than expected

Powell: The Reserve Bank will take action if inflation is higher than expected

US Federal Reserve Chairman Jerome Powell said the central bank was committed to achieving its targets and would take action if inflation exceeded expectations.

He added, “Monetary policy will ensure that the economy supports itself until the end of the recovery.”

The US Federal Reserve has said it will not change its key interest rate and is committed to using all tools to support the economy. The Federal Reserve Monetary Policy Committee on Wednesday unanimously decided to set the overnight lending rate at 0-0.25%.

The central bank said it would continue to buy at least $ 80 billion a month in treasuries and $ 40 billion a month in mortgage-backed securities until there is a “significant additional improvement” toward full employment and price stability targets.

The central bank said that the trend of the economy still depends on the course of the virus and that the progress of vaccinations is likely to continue to reduce the effects of the health crisis on the economy, but there are still risks to the economic outlook.

Furthermore, the central bank said that inflation often reflects volatile factors and that a moderate pace in asset purchase momentum could soon be guaranteed if progress towards employment and inflation targets continues as expected. (Agent)

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