Powell: There could be 1 or 2 more rate hikes

Fed Chairman Jerome Powell said in his second day of presentation to the US Congress that 1 or 2 more interest rate hikes may be necessary this year. Powell answered questions from members of the US Senate Banking, Housing and Urban Affairs Committee on the second day of his presentation of the semiannual Monetary Policy Report in the US Congress. Powell emphasized the importance of returning to the 2 percent inflation target for the healthy functioning of the US economy in the long term and gave the message that there will be more interest rate hikes this year. Powell said that working families are the most and fastest affected by inflation. Powell said, “Fed officials believe that if the economy performs as expected, it would be appropriate to increase interest rates 1 or maybe 2 more times this year.” Powell emphasized that they are determined to control inflation and made the assessment that “there is still a long way to go in terms of increasing interest rates.” Fed Chairman Powell also stated in his presentation to the Financial Services Committee of the US House of Representatives yesterday that there is a long way to go in the process of reducing inflation to the 2 percent target and that it would be appropriate to increase interest rates a little more by the end of the year. Speaking at a different event today, Fed Governor Michelle Bowman gave a message similar to Powell's hawkish rhetoric that additional interest rate hikes are necessary to rein in unacceptably high inflation.