Fed chair Jerome Powell tries to chill rate cut talk
Federal Reserve chair Jerome Powell got the final word Friday before the Fed enters a quiet period ahead of the next policy meeting.
Driving the news: In a brief speech, he tried to tamp down the "interest-rate-cuts-are-coming" narrative that drove financial market excitement this week.
What they're saying: "It would be premature to conclude with confidence that we have achieved a sufficiently restrictive stance, or to speculate on when policy might ease," Powell said. "We are prepared to tighten policy further if it becomes appropriate to do so."
- He added that the Fed "is moving forward carefully, as the risks of under- and over-tightening are becoming more balanced."
Why it matters: A slew of Fedspeak — including, notably, Fed governor Christopher Waller — has dealt with the prospect of rate cuts in 2024.
- However, the Fed chief seems to be taking a more measured approach: A near-term easing is not on the table.
- Powell said the Fed is committed to "keeping policy restrictive until we are confident that inflation is on a path" to its target.
Of note: Powell spoke at Atlanta this afternoon before an audience of students and faculty at Spelman College — the HBCU from which his colleague, Fed governor Lisa Cook, graduated some 40 years ago. It's the first time a Fed chair has visited the university.
One moment that got big laughs: Spelman president Helene Gayle asked "What does fun look like for the chair of the Federal Reserve?"
- "For me, a big, big party, and I mean this is as fun as it gets: a really good inflation report," Powell said.
(Well, it's safe to assume, Powell has been having a lot of fun lately!)