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Added on the 14/02/2017 16:16:26 - Copyright : AFP EN
Janet Yellen takes centre stage at the Jackson Hole central banking symposium - investors waiting nervously for any steer on future U.S. rate hikes. But as Kirsty Basset reports, the Fed chief also faces a more fundamental question: is conventional monetary policy running out of road?
Janet Yellen takes centre stage at the Jackson Hole central banking symposium - investors waiting nervously for any steer on future U.S. rate hikes. But as Kirsty Basset reports, the Fed chief also faces a more fundamental question: is conventional monetary policy running out of road?
The US Federal Reserve is prepared to raise interest rates higher -- and hold them there -- in order to bring down elevated inflation. "We are prepared to raise rates further if appropriate, and intend to hold policy at a restrictive level until we are confident that inflation is moving sustainably down toward our objective," says Jerome Powell in a central banking conference in Wyoming. SOUNDBITE
Images of the roundtable meeting of EU finance ministers who are meeting discuss energy prices and fiscal policy. IMAGES
Federal Reserve Chair Jerome Powell announces the Fed will hold off on raising the benchmark interest rate and will not react to temporary inflation pressures, warning that "ill-timed policy" could be "particularly harmful" as the US continues its economic recovery from the coronavirus pandemic. Kicking off an online economic symposium, Powell also stresses that the US economy is on track to return to a strong labor market despite the continued spread of the Delta variant. SOUNDBITE
Inflation may be rearing its ugly head in the US economy sooner than predicted. According to Business Insider, a recovery of the US's hardest-hit businesses could drive a faster-than-expected rebound for inflation. The US Federal Reserve aims to reach inflation of at least 2% before considering lifting its benchmark interest rate. However, price growth has trended below that level for years and fell further at the start of the pandemic. Kansas City Fed President Esther George said Tuesday that struggling industries could be placing outsized downward pressure on inflation. She added that a swift economic reopening could see businesses in travel and hospitality could rapidly bounce back--thereby driving inflation higher.
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