JUNE 27, 2022 – FED CHAIR SAYS CONTROLLING INFLATION IS CRITICAL
Federal Reserve Chairman Jerome Powell says getting inflation back down to the Fed’s 2 percent target is of prime importance, even if it tips the economy into recession. As of May, inflation sat at 8.6 percent, a 40-year high. He said the soft-landing the have been aiming for could be “very challenging” to achieve.
“The other risk, though, is that we would not manage to restore price stability and that we would allow this high inflation to get entrenched in the economy,” Powell said at a Senate Banking Committee hearing. The Fed has raised interest rates three times since March, and it will continue on that path through the rest of the year. Powell said central bank officials “anticipate that ongoing rate increases will be appropriate.”
With another 0.75 percent increase expected in July and 0.5 percent in September, you still have time to review your debt portfolio and put hedges in place to mitigate the effects of rising interest rates.