Powell: 'The Fed Funds Rate is Not in Restrictive Territory'

IconCryptoNewsTerminal Staff13 Jun, 2024

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Powell: 'The Fed Funds Rate is Not in Restrictive Territory'

Federal Reserve Chairman Jerome Powell said at a news conference after the Federal Open Market Committee (FOMC) meeting on Wednesday that the Fed funds rate is not yet in restrictive territory. This means that the Fed believes that it can continue to raise interest rates without slowing economic growth too much. Powell's comments were in response to a question about whether the Fed was considering pausing its rate hike campaign. The Fed has raised interest rates by 225 basis points so far this year, and markets were expecting another 75 basis point hike at the September FOMC meeting. However, Powell's comments suggest that the Fed may be willing to slow the pace of rate hikes in the future. Powell also said that the Fed is "not trying to engineer a recession." He said that the Fed is "trying to bring inflation down to our 2% target, and we think we can do that without having a recession." The Fed's decision to raise interest rates is a response to the high inflation that has been plaguing the U.S. economy. Inflation is currently at a 40-year high, and the Fed is concerned that it could continue to rise if it does not take action.

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