TEHRAN, Young Journalists Club (YJC) -Federal Reserve Chairman Jerome Powell on Friday defended the U.S. central bank’s push to raise interest rates as healthy for the economy and signaled more hikes were coming despite President Donald Trump’s criticism of higher borrowing costs.
The Fed, which began to tighten monetary policy in 2015, has raised rates twice this year and is widely expected to do so again next month and in December.
Speaking at a research symposium in Jackson Hole, Wyoming, Powell said he wanted to “explain today why my colleagues and I believe that this gradual process ... remains appropriate.”
“The economy is strong. Inflation is near our 2 percent objective, and most people who want a job are finding one ... If the strong growth in income and jobs continues, further gradual increases in the target range for the federal funds rate will likely be appropriate.”
Powell made no mention of Trump’s criticism of the Fed’s monetary policy. In an interview with Reuters on Monday, Trump said he was “not thrilled” with Powell’s Fed for raising rates and said the central bank should do more to help boost the economy.
In his speech, Powell simply made the case that gradual rate hikes are the best way to protect the U.S. economic recovery and keep job growth as strong as possible and inflation under control.
The benchmark S&P 500 index .SPX and the Nasdaq Composite .IXIC hit all-time highs after Powell's speech while the dollar .DXY weakened against a basket of currencies. Traders of interest rate futures kept their bets on rate hikes in both September and December.