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Chair of the Federal Reserve Jerome Powell. Photo: Pool/Getty Images

The Federal Reserve made no changes to its policy rate on Wednesday and chair Jerome Powell was resolute in insisting that the central bank is still not ready to "think about thinking about" or "talk about talking about" raising U.S. interest rates or reducing its $120 billion a month bond-buying program.

Why it matters: As the economy has improved and inflation expectations and price hikes have picked up, economists and market participants have wondered aloud if the Fed was open to reducing its massive market assistance sooner than expected.

  • The answer was a resounding no.

What happened: Powell made numerous references to what he called the Fed's "substantial further progress" test, which he did not define but made abundantly clear had not been reached.

What he's saying: "We articulated the substantial further progress test at our December meeting and really for the next couple of months made relatively little progress toward our goals … and then vaccinations started to get more widespread, the economy reopened, we got a really nice job report for March," Powell said during a press conference following the Fed's rate decision.

  • "It doesn’t constitute substantial further progress. It’s not close to substantial further progress."

The big picture: The Fed's new plan of action is to let inflation rise above its 2% target for some time and that has not yet happened.

  • However, prices are rising in housing, food, cars, toys and just about everywhere else, leading some like former Treasury Secretary Lawrence Summers and former Global Development Council chair Mohamed El-Erian to worry openly that the central bank's new framework risks allowing inflation to hurt the economy.

The bottom line: "We’re hopeful we’ll see along this path a way to that goal [of substantial further progress] and we believe we will. It just is a question of when," Powell said.

  • "When the time comes for us to talk about talking about it, we’ll do that. But that time is not now. We’re just not that far. We’ve had one great jobs report, it’s not enough. We’re going to act on actual data, not our forecast and we’re just going to need to see more data. It’s no more complicated than that."

Go deeper

Dion Rabouin, author of Markets
Apr 27, 2021 - Economy & Business

Earnings, inflation fears and Fed meeting make for busy week in markets

Illustration: Sarah Grillo/Axios

Concerns about higher taxes and inflation pushed the S&P 500 to its first weekly loss since mid-March last week, but Monday began where that week ended with stocks moving higher.

What's happening: While traders are largely looking past inflation worries, even after last week's IHS-Markit purchasing managers index showed yet another record high reading for prices, company executives are not.

Dion Rabouin, author of Markets
Apr 28, 2021 - Economy & Business

Consumer comfort with returning to normal reaches all-time pandemic high

Data: Investing.com; Chart: Axios Visuals

Tuesday's strong consumer confidence report from the Conference Board wasn't the only good news about U.S. consumers. Data are beginning to show more Americans are getting more comfortable with returning to regular pre-pandemic activities.

Driving the news: Morning Consult's "Tracking the Return to Normal" series reveals all-time highs in consumer comfort across activities including dining, entertainment, sports and more.