FOMC Chair Powell appeared before the Senate’s Committee on Banking, Housing, and Urban Affairs overnight in part one of his Semiannual report to Congress. Abstracting from the frequent political focus of the Committee, Chair Powell’s message on the economy was clear: “the FOMC believes that – for now – the best way forward is to keep gradually raising the federal funds rate”.
In his prepared remarks, Chair Powell showed no particular concern on inflation. It was noted to have been “a little above 2 percent” recently, but this was due to “a significant increase in gasoline and other energy prices”. Looking forward, the symmetric nature of the “2 percent objective” was (again) highlighted, with the FOMC said to only be “concerned if inflation were running persistently above or below our objective”.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
