Fed Chair Powell Advocates Policy Restraint Amid Inflation Risks

Federal Reserve Chair Jerome Powell conveyed to lawmakers that there is no urgency to lower interest rates due to a resilient labor market and ongoing inflation concerns. Powell noted that labor market conditions remain solid, with job gains averaging 189,000 per month and the unemployment rate at 4%. He emphasized that the Fed's monetary policy is less restrictive than before, and the central bank is adopting a patient stance, as the inflation rate has not sustainably reached the 2% target. Powell highlighted the need for the Fed to remain independent of political pressures, asserting that focusing solely on economic data will ensure better policy outcomes. Meanwhile, the Trump administration's new tariffs on steel and aluminum could pose further economic uncertainties. Powell's comments suggest the Fed will maintain its current policy until there is a clearer trajectory of inflation reaching its target.