Powell Urges Patience Amid Economic Strength and Lingering Inflation

Federal Reserve Chair Jerome Powell indicated no rush to cut interest rates due to ongoing economic growth and inflation above target. Despite expectations of fewer rate cuts next year, Powell affirmed confidence in disinflation while remaining cautious about U.S. economic prospects under the new administration.

Federal Reserve Chair Jerome Powell stated Thursday that the robust economic growth and a formidable job market mean there is no need for a hasty reduction in interest rates despite inflation remaining above the 2% target. Powell emphasized a careful approach towards monetary policy adjustments.

His comments resonate with the evolving market sentiment of fewer interest rate cuts next year. Powell reiterated inflation's trajectory toward the Fed's target, while indicating that rate cuts are flexible. "The economy is resilient, allowing deliberate decision-making," Powell remarked at a Dallas Fed event.

Amid election shifts and Trump's impending policies, Powell noted the economy's solid state with unemployment at 4.1% and growth exceeding expectations. However, inflation measures continue above target, prompting cautious Fed oversight, especially concerning housing costs.

(With inputs from agencies.)