Powell: The Reserve will take action if inflation remains higher than expected

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US Federal Reserve Chairman Jerome Powell said the central bank is strongly committed to achieving its goals and will take action if inflation remains higher than expected.

He added, “The Fed’s actions will ensure that monetary policy supports the economy until the recovery is complete,” revealing that “the Fed discussed an appropriate pace to ease stimulus if the necessary conditions for doing so are achieved.”

The US Federal Reserve kept its key interest rate unchanged and said it was committed to using all the tools at its disposal to support the economy. The decision to keep the overnight loan rate at 0-0.25% was taken unanimously at the Federal Reserve’s Monetary Policy Committee on Wednesday.

The Fed said it would continue to buy at least $80 billion a month in Treasuries and $40 billion a month in mortgage-backed securities until it made “significant additional progress” toward full employment and price stability goals.

The Fed said that the course of the economy still depends on the course of the virus, and that progress in vaccines is likely to continue to reduce the effects of the health crisis on the economy, but there are still risks to the economic outlook.

Also, the Fed said that inflation is elevated largely reflecting transient factors, and that if progress toward employment and inflation targets continues as expected, it believes that a moderation in the pace of asset purchases may be warranted soon. (agencies)





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