Analysis: The severe inflation fluctuations have put the Federal Reserve in an awkward wait-and-see situation
According to BlockBeats news on July 9, an article by "Fed's mouthpiece" Nick Timiraos stated that in the second half of last year, despite strong spending and hiring, the speed at which price growth slowed down was so fast that it surprised officials. This prompted them to shift their focus from how high interest rates should be raised to how long they need before cutting rates.
The last time Powell appeared before Congress was in early March when he hinted that the Fed might cut interest rates before June. After that, inflation reversed course, derailing any such plans.
Powell said today that recent inflation data "shows some mild further progress; more good data will boost our confidence that inflation is steadily moving towards 2%." The violent fluctuations in inflation have put the Fed in an awkward wait-and-see situation. Policymakers either wait for a few months of convincing mild inflation data or evidence of significant slowdowns in employment and economic activity before cutting interest rates.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Data: EIGEN, OP, ENA will usher in a one-time large unlock, worth nearly $50 million
Data: BTC Breaks $63,000