Jerome Powell Really Doesn’t Want to Talk Fiscal Policy | Global News Avenue

Federal Reserve Chairman Jerome Powell said on Thursday it was too early to discuss how future fiscal policy would affect the central bank’s path forward, sticking to a line he has used since the last presidential election.

Powell responds to comments he made after Fed Open Market Committee Last week’s meeting. At that meeting, central bank policymakers cut the influential federal funds rate by a quarter of a percentage point to stabilize employment and keep inflationary pressures at moderate levels.

Powell said Thursday that while he declined to discuss how fiscal policy might affect future rate cuts, he said the economy was doing “very well.”

But during an appearance in Dallas on Thursday, the chairman declined to discuss tariffs, immigration and other issues. proposed policy President-elect Donald Trump could transform the economy.

“We don’t actually know what policies are going to be implemented,” Powell said when asked whether central bank officials would consider any policy changes at their next meeting. “I think we have time to evaluate before we make a policy response. The net impact of policy changes on the economy.”

Why are Trump and Powell at odds?

Powell has been clashing with President-elect Donald Trump. Threaten the Fed’s independence and criticized the central bank’s decisions during the latest bout of high inflation.

Powell was asked migrantFederal Reserve research shows this boosts the economy by adding to the labor force. He did not comment specifically on Trump’s proposals for mass deportations or restrictions on immigration. He did say, however, that more workers mean more economic output.

Tariffs were another key economic tenet of Trump’s campaign and another topic that Powell did not comment directly on. He said it was difficult to determine what impact the tariffs themselves, as well as economic retaliation from other countries, would have on the U.S. economy.

Will rate cuts be slowed for other reasons?

Powell forecast inflation will continue to be range-bound in the near term but said he still expects price pressures to remain close to the central bank’s 2% annual target. His comments came after the release of a consumer price index report on Wednesday, which showed Inflation rose year-on-year in Octoberreports Thursday morning showed Wholesale inflation rises.

Despite Powell’s confidence, he remains cautious about moving too quickly, hoping to stabilize the labor market and limit inflation.

“Inflation has fallen significantly and the labor market has not yet completely stabilized, but it is doing well,” he said. “I think in this case we need to err on the side of caution and as we get closer to a reasonable range of neutral levels we might slow down the pace of what we’re doing just to increase the chance that we’re doing it right.”