Powell: “The timing of the base rate cut is approaching… Discussions are possible in September”

by times news cr

2024-08-01 05:48:43

ⓒNewsis

The U.S. Federal Reserve (Fed) froze its benchmark interest rate for the eighth consecutive time on the 31st (local time), but Fed Chairman Jerome Powell mentioned the possibility of a rate cut in September, saying that the timing of a rate cut is approaching.

At a press conference following the regular Federal Open Market Committee (FOMC) meeting on the same day, Chairman Powell said, “We have not made any decisions about future meetings, including the September meeting,” but added, “The committee’s general view is that the economy is getting close to a point where it would be appropriate to begin cutting interest rates.”

Powell explained that if there is sufficient confidence that inflation has slowed and that the labor market remains strong, a rate cut could be discussed as early as the September meeting.

However, he added that it is not yet the right time to cut the base interest rate.

He also answered positively to a question asking whether he was considering a scenario for a September rate cut if current indicators remain the same.

“If, for example, inflation were to slow rapidly and in line with expectations, and growth were to remain fairly strong, and if the labor market were to remain in its current form, I think there would be room for a rate cut at the September meeting,” Powell said.

The Federal Reserve froze the benchmark interest rate at 5.25-5.50% at the FOMC meeting held over the past two days.

“Inflation has moderated over the past year but remains somewhat elevated,” the Fed said, noting that “additional progress has been made toward the Committee’s 2 percent inflation objective in recent months.”

[워싱턴=뉴시스]

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2024-08-01 05:48:43

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