Federal Reserve Chair Jerome Powell begins his semi-annual testimony to Congress, emphasizing that the US central bank is in no rush to adjust interest rates due to a stronger economy and a less restrictive policy stance. However, Powell notes to US lawmakers that adjustments could occur if inflation or the labor market changes unexpectedly.
Yahoo Finance senior Fed reporter Jennifer Schonberger is on the scene providing the latest details from Capitol Hill.
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This post was written by Josh Lynch
Welcome to Catalyst, some breaking news at the top of the hour. The text of Fed chair Jerome Powell's opening remarks to Congress are crossing the wires right now. Let's head to Yahoo Finances Jennifer Schonberger. She's inside the Beltway with the latest, Jen.
Good morning. Fed chair Jay Powell just sat down about five minutes ago to testify before the Senate Banking Committee in the first day of his two-day semiannual testimony to Congress, where he will tell lawmakers that the Fed is not in a hurry to adjust interest rates. Powell will say, quote, with our policy stance now significantly less restrictive than it had been, and the economy remaining strong, we do not need to be in a hurry to adjust our policy stance. Powell stressed that if the economy remains strong and inflation shows little progress towards the Fed's 2% goal, then the central bank could maintain rates steady for longer. If, however, the job market were to weaken unexpectedly, or inflation were to fall more quickly, then the Fed could adjust rates accordingly. Powell will say, quote, we will do everything we can to achieve the two goals Congress set for monetary policy: maximum employment and stable prices. Powell's reiteration that the Fed expects, is not in a hurry rather to hold rate steady comes in the face of uncertainty about the impact of the Trump administration's policies and stubborn inflation. Chairman Tim Scott, who has just started this hearing behind me, is expected to press the chair Powell on the re-proposal of Basel III and streamlining regulations for banks. Meanwhile, the ranking member on this committee, Senator Elizabeth Warren, sent a letter to Powell last night, saying, quote, why is the plan, Fed planning to weaken banking rules, appending the stress tests? Back in December, the Fed said it is looking for comment on creating more transparency for the bank stress tests. Guys, this hearing getting underway just now.
