What To Expect From Fed Chair Powell’s Testimony To Congress This Week | Global News Avenue

Fed Chairman Jerome Powell, who will appear in Congress this week, will assess the Fed’s fight against inflation and may face scrutiny on the central bank’s decision-making process.

Powell is scheduled to appear in the Senate and House of Representatives on Tuesday to deliver two Fed reports to Congress. The Fed submitted a written report to lawmakers last week outlining the economic situation, thus gaining insight into Powell’s testimony.

The report said inflation was running “somewhat higher” than the Fed’s 2% annual target. It also describes the job market as solid, with relatively low unemployment rates. The work of the Federal Reserve, As per Congress’s requestis to control high inflation and employment.

The Fed is in holding mode

Powell’s testimony is here The Fed enters “waiting for observation” The stage of the method of setting interest rates.

The Fed lowered its benchmark interest rate three times since September, as the post-popular inflation rate appears to have reached its central bank’s annual target of 2%.

But this progress has been stagnant for months, President Donald Trump’s waste tariff (Improvement and threat) Uncertainty among policy makers Regarding whether there is fresh inflation on the way.

Powell may face some scrutiny

If billionaire Elon Musk’s social media post shows any signs, Powell could also face tough problems with the role of the Fed.

Over the past few days, Musk has posted several posts on his social media platform X, calling for a review of the Fed and suggesting that former member of the Fed would be shut down, Ron Paul, as chairman. (The Federal Government’s regulator, the Office of Government Accountability, regularly reviews the Federal Reserve.)

Since Trump’s appointment of Musk The cost-cutting tsar. For example, the White House closed activities of the U.S. International Development Agency and Musk criticized the Post-Civil Financial Protection Agency.

Powell can defend the independence of the Federal Reserve

The independence of the Fed may also be a hot topic at the hearing, especially in the context of Trump Blitzkrieg quickly reshapes government policies Adopt executive orders. Trump suggests The White House is more influential Beyond the Fed’s policy decision, and Powell has Defend the independence of the Federal Reserve From politics to its mission.

The main tool for the Fed to control inflation is Federal funding ratewhich affects the borrowing costs of various loans. In the past, Trump clashed with Powell and criticized him for keeping interest rates too high.

However, Trump said last week that at the last meeting, stable Fed holding rate was “the right thing to do”, reversing his previous remarks demanding lower rates.