Participants of the annual symposium in Jackson Hole were looking forward to the speech of the head of Fedresev Jerome Powell. His speech was also focused on investors and traders.
Jerome Powell’s performance can be called optimistic in general. He began by stating that the recent normalization of monetary policy is well founded and justified. After these words, the estimate of the probability of an increase in the rate in September by market participants rose to almost 100 percent.
The Head of the Fedreserva noted the positive dynamics of the United States economy. Consumer and business confidence is growing, new jobs are being created and income is increasing.
Jerome Powell believes that there are no signs that would indicate an overheating of the American economy, as well as no signals of a possible increase in inflation above the target of 2 percent. He also noted the existence of external and internal risks, which may have a negative impact on the economy of the country. At the same time, Powell did not go into more detail on this issue. He only assured that if this happens, the Federal Reserve Board is ready to promptly take the necessary measures to prevent a financial crisis.
The chairman of the Fed Reserve has rejected the criticism regarding the rate of increase in the rate of interest, and said that the Central Bank does not intend to give up its plans to gradually increase the key rate.