Federal Reserve Chairman Jerome Powell on Tuesday said, U.S. economy is healthy enough to adjust to tighter monetary policy.
In a confirmation hearing before the U.S. Senate Committee on Banking, Housing and Urban Affairs, he expected a series of interest rates hikes this year. Besides the FED will undertake reduction in extraordinary help extended during the pandemic era.
“As we move through this year … if things develop as expected, we’ll be normalizing policy, meaning we’re going to end our asset purchases in March, meaning we’ll be raising rates over the course of the year,” he told committee members. “At some point perhaps later this year we will start to allow the balance sheet to run off, and that’s just the road to normalizing policy.”
“If we see inflation persisting at high levels longer than expected, then if we have to raise interest more over time, we will,” Powell said. “We will use our tools to get inflation back.”
