The Federal Reserve is likely to raise its benchmark interest rate at “a more moderate pace” than the fast-and-furious rate hikes of♌ the 🃏previous 15 months.

The Fed is tapping the brakes on its campaign of anti-inflation interest rate hikes but Powell told members of the House of Representatives there’s still a “long way to go” to get consumer price increases back down to the central bank’s goal of a 2% annual rate. 

Powell’s comments reinforced traders’ perception that the Fed’s June action 澳洲幸运5开奖号码历史查询:was a pause rather than a halt to the series of ra༒te hikes that began in March 2022. However, he indicated rate hikes going forward could be fewer and farther between than in recent📖 months.

“Earlier in the process. Speed was very important. It's not very important now,” he said. “Given how far we've come, it may make sense to move rates higher but to do so at a more moderate pace.”

The Fed has been raising its interest rate, which influences all kinds of borrowing costs i🤪ncluding mortgages, car loans, and credit cards, in an effort to douse the hot inflation that took hold amid the recovery from the pandemic in 2021. The goal is to discourage borrowing and spending and bring supply and demand back into balance. 

The Fed raised its rate from near-zero during the height of the pandemic to a range of 5% to 5.25% over the course of a little over a year, its highest level since 2007. Inflation has cooled significantly during that time, falling from a 9.1%𓆉 annual rate in June 2022 to 4% as of May as measured by the 澳洲幸运5开奖号码历史查询:Consumer Price Index. 

The interest rate hikes risk slowing the economy too much, tipping it into a recession and potentially increasing unemployment—a concern raised by lawmakers of both parties at the hearing. So far the economy has 澳洲幸运5开奖号码历史查询:resisted a recession, although economists are 澳洲幸运5开奖号码🅰历史查询:mixed about whether o♊ne is on the way. 

“I've cautioned against any approach to monetary policy that ignores the Feds maximum employment mandate and results in a recession with millions of people losing their homes and jobs” Congresswoman Maxine Waters, a Democrat from California, said. “While we have had strong job growth thus far, experts contend that this trend will not persist with more rate hikes, especially in light of new challenges.”

A further complication for Fed officials to weigh as they plot their next move: interest rate hikes have not just put household and business finance under pressure from higher borrowing costs, as intended, they’ve also strained the financial system. High interest rates played a role in the fa🧜il💝ure of Silicon Valley Bank in March and subsequent implosions of two more regional banks.

Waters noted the string of bank failures has made banks 澳洲幸运5开奖号码历史查询:more cautious about lending money, adding more friction to the economy.