Fed President Jerome Powell signaled that at a meeting held today at a meeting held in September, he could reduce interest rates.
Jerome Powell, President of the United States Bank (Fed), pointed out that the risk of reduction for employment has increased and said that the basic appearance and change of risk balance may ask them to adjust the policy stance.
Powell, in his speech at Jackson Hole's economic policy seminar, organized by Kansas City Fed, made reviews of monetary policy.
In his speech, Powell, opened the interest rate, said: “With the fact that the policy is in a limited area, the basic appearance and balancing the risk of change can ask us to adjust our policy posture. Criticism with Trump: There is uncertainty about all these policies
Saying that the US economy is resistant to the context of comprehensive changes in economic policies throughout the year, Powell said that the labor market is close to the maximum work and inflation is still a bit high, although the Kovid-19 epidemic has decreased significantly from the summit.
Powell pointed out that the economy is facing new challenges this year, and the significant tax increase in shape of the global trade system, strict migration policies leading to a sudden decline in labor growth, and in the long run, changes in tax, spending and prescribed policies may have a significant impact on economic growth and efficiency. “There is a significant uncertainty about where all these policies will come to the end and their long -term effects on the final economy will.” He said. “This balance can cause dismissal”
In general, the labor market seems to be balanced, but this is a kind of “interesting” balance caused by significant slowing both in the supply and demand of the workforce “, this abnormal situation shows that the risk of employment has increased. And if these risks occur, it can show itself in the form of rapid increase and increase unemployment.
Powell says that the growth of the country's economy has slowered significantly in the first half of the year and the decline in growth reflects a lot of slow -slowing consumers' spending. President Powell said that as in the labor market, part of slow growth can reflect slow growth in supply or potential production. “The effects of tariffs are now clearly visible” In the inflation front, high tax rates began to increase prices in some types of goods, showing that Powell, “the impact of tariffs on consumer prices has been clearly seen,” he said. Powell said they hope these effects will accumulate in the coming months, but there is a high uncertainty in time and quantity. Powell said whether these price increase will significantly increase the risk of a inflation problem about monetary policy and a reasonable scenario will be relatively short -mean, a one -time change will be experienced at the price. Powell says that the reflection of an increased tariffs for the supply chain and the distribution network will take time, the tax rate continues to change and this is likely to extend the adaptive process. Saying that it is possible to activate a more permanent inflationary motivation of the increased pressure due to tariffs, Powell says this is a risk that needs to be assessed and managed. “Regardless of the price, we will not allow an increase in a price to become a continuous inflation problem,” Powell said. In a short time, President Fed Powell, the risks of inflation are increasing, while the risks of employment are decreasing, this is a challenging situation, he said. Powell repeats that the monetary policy is not on the way that is defined in advance and emphasizes that members of the Federal Open Market Committee (FOMC) will only make their decisions by evaluating their data and influence on economic appearance and risk balance.
Bank and rose gold stock
After Powell's statements, stocks of major US banks have achieved value. Bank of America is 0.7 %, 0.7 %JPMorgan, Citigroup 0.5 %, Goldman Sachs 0.7 %, 0.8 %Morgan Stanley and Wells Fargo 0.6 %.
In the morning session of gold, starting $ 3,323 in the morning, Powell's speech increased by 1.11 % after information about policy changes and increased to $ 3,361. As of 17.34, gold ounce continued to achieve a value at $ 3372.