Jay Powell has said the Federal Reserve needs to move “expeditiously” towards tighter monetary policy to bring down excessive inflation, expressing confidence that the US central bank could do so without causing a recession.
In remarks delivered at a conference hosted by the National Association for Business Economics on Monday, the Fed chair laid out the case for a series of interest rate increases this year and substantive steps to shrink the central bank’s $9tn balance sheet, as it confronts a labour market that looks “extremely tight” and inflation that is “much too high”.
“There is an obvious need to move expeditiously to return the stance of monetary policy to a more neutral level and then to move to more restrictive levels if that is what is required to restore price stability,” he said.