Jerome Powell, chairman of the US Federal Reserve, will speak on Friday, March 7, 2025 during the University of Chicago Booth School of Business Monetary Policy Forum in New York, USA.
Yuki Iwamura | Bloomberg | Getty images
NEW YORK – Jerome Powell, chairman of the Federal Reserve, said on Friday that the central bank can wait to see how the aggressive policy actions of President Donald Trump take place before it moves at interest rates.
With markets nervous about Trump’s proposals for rates and other issues, Powell statements that he and his colleagues have recently patient for patience on monetary policy in the middle of the high level of uncertainty.
The White House “is busy implementing important policy changes in four different areas: trade, immigration, tax policy and regulations,” he said in a speech for the US Monetary Policy Forum. “It is the net effect of these policy changes that are important for the economy and for the path of monetary policy.”
Note that “uncertainty about the changes and their likely effects remain high,” Powell said that the FED is “aimed at separating the signal from the noise as the outlook evolves. We don’t have to be in a hurry and are well positioned to wait for greater clarity.”
The comments are at least somewhat at least at odds with the growing market expectations for interest rates this year.
While the markets are on his agenda by Trump’s positions on his agenda Fedwatch indicator.
However, Powell’s comments indicate that the Fed is in a wait -and -see mode before they map out further policy dependence.
“Policy is not on a predetermined course,” he said. “Our current policy position is well positioned to tackle the risks and uncertainties with which we can pursue both sides of our double mandate.”
The policy forum is sponsored by the Clark Center for Global Markets from the University of Chicago’s Booth School and included several FED officials in the audience. Most policy makers of the central bank have recently said that they expect the economy to last and that inflation will fall back on the purpose of 2% of the FED, with the tariff climate still unclear the more Trump’s policy comes into the picture.
In his assessment, Powell also spoke in mainly positive terms about the macro environment, and said that the US is in “a good place” with a “solid labor market” and the inflation that goes back to the target.
However, he noted that recent sentiment surveys showed doubts about the path of inflation, largely a product of the Trump rate talk. The preferred meter of the FED showed the inflation of 12 months by a percentage of 2.5%, or 2.6% when excluding food and energy.
“The path to sustainably recurring inflation to our target has been bumpy and we expect that that will continue,” said Powell.
Fed -Governor Adriana Kugler, who was not on the forum, said in a speech that was held on Friday in Portugal that she sees “important upward risks for inflation” and said that “it could be appropriate to keep the policy percentage at the current level for some time.”
The comments also came on the same day that the employment department for February reported a profit of 151,000 to Niet -Farm Wageslist. Although it was slightly lower than market expectations, Powell said that the report is more evidence that “the labor market is solid and broadly balanced.”
“Wages grow faster than inflation, and at a more sustainable pace than before in the Pandemic recovery,” he said.
The average hour trips rose by 0.3% in February and rose by 4% on an annual basis. The job report also indicated that the unemployment rate fell higher to 4.1% as employment in households fell.