Powell Talks Rates

Federal Reserve Chair Jerome Powell said this week that “it may take longer than expected” for high interest rates to lower inflation. But did not suggest that the slowing labor market would mean earlier rare cuts. 

All in all, it wasn’t the best breakdown from Powell. He said, “we’ll need to be patient and let restrictive policy do its work. It may be that [high interest rates] take longer than expected to do its work and bring inflation down.” 

These remarks come after officials kept short term interest rates at a 23-year high (5.5%).

With inflation remaining high in 2024 so far, Fed officials said they likely would keep rates higher for a longer period of time now, after originally planning for the first, of three, rate cuts to take place this month.