Federal Reserve Chairman Jerome Powell said Tuesday that rampant inflation is “not a problem” to fear amid the recovery from the coronavirus recession.
Powell told members of a Senate panel that while technical factors and the release of pent-up savings may push prices higher when the pandemic subsides, it won’t be enough to reverse decades of downward pressure on inflation.
“We’ve averaged less than 2 percent inflation for more than the last 25 years,” Powell told the Senate Banking Committee, referring to the Fed’s annual inflation target.
“Inflation dynamics do change over time, but they don’t change on a dime, so we don’t really see how a burst of fiscal support or spending that doesn’t last for many years would actually change those inflation dynamics.”
Powell has tried for months tried to dispel concerns about the potentially inflationary impact of trillions in fiscal and monetary support for the struggling U.S. economy. Republican lawmakers, some Wall Street analysts and even a handful of center-left economists have expressed fears that President Biden’s $1.9 trillion relief bill and Fed measures could overheat the economy as the pandemic eases.
Read more at The Hill.
{Matzav.com}
