Speaking to the Economic Club of New York today, Federal Reserve Chair Jerome Powell said that interest rates would have to stay high until official consumer inflation dropped to 2% (although it has already fallen to 3.7% annual rate from 9% early in 2022, and the effects of rate hikes in making inflation decline are considered delayed and uncertain). The Federal Funds rate is now at 5.25%, having been pushed up from zero in a series of increases at least as rapid as any in the Fed’s history. As Powell spoke, the 10-year Treasury rate was reaching 5% in a very rapid and ongoing spike.
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Fed’s Powell Keeps Defending High Interest Rates
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