THE NEW YORK TIMES: Federal Reserve Chair Jerome Powell said the central bank is likely to raise rates at its meeting this month, even with geopolitical upheaval.
Jerome H. Powell, the Federal Reserve chair, will tell lawmakers on Wednesday that the central bank is poised to lift interest rates from near zero at its meeting later this month as it embarks on an effort to cool down high inflation — even as conflict in Ukraine ramps up uncertainty.
“We expect it will be appropriate to raise the target range for the federal funds rate at our meeting later this month,” Mr. Powell said in testimony prepared for delivery to the House Committee on Financial Services. He noted that the Fed will move toward a “predictable” shrinking of its big bond holdings after raising rates, a move that will take additional steam out of the economy.
While Fed officials are prepared to use their policies to make money steadily more expensive in a bid to slow consumer and business demand, hoping to cool off today’s rapid prices, Mr. Powell added that the central bank must be poised to respond as Russia’s invasion of Ukraine looms large.
“The near-term effects on the U.S. economy of the invasion of Ukraine, the ongoing war, the sanctions and of events to come, remain highly uncertain,” he said. “We will need to be nimble in responding to incoming data and the evolving outlook.” » | Jeanna Smialek | Wednesday, March 2, 2022
