U.S. Federal Reserve Chair Jerome Powell recently shared that the economy is doing better than expected. When the Fed started lowering interest rates in September, they thought the economy was weaker. Now, Powell says the job market looks good, the economy is growing stronger, and inflation is a bit higher than they thought.
Powell spoke at a New York Times event, and his comments came just before a big Fed meeting on December 17-18, where they are likely to make more decisions about interest rates. Some Fed officials, like Christopher Waller, have hinted they might cut rates again soon, unless new data suggests otherwise. Powell seems to agree with this cautious approach.
He mentioned that the Fed’s previous rate cut was a signal to support jobs if the market was weak. But now, better data suggests the economy is stronger than they had anticipated.
Federal officials will soon get new data on jobs and inflation that will help them decide what to do next. Powell emphasized that their decisions are based on the current situation, not on what might happen in the future.
Other Fed officials like Alberto Musalem and Thomas Barkin are also being careful. They want to look at new information before making any promises about future rate cuts. The inflation rate remains above the Fed’s target of 2%, so they are keeping a close watch on it.
With mixed signals from various reports—some showing stronger spending and others pointing to concerns about rising prices—Fed officials are staying on alert and cautious about their next moves.
