Federal Reserve Chairman Jerome Powell Addresses the Media Following the FOMC’s Decision to Keep Interest Rates Unchanged

The Federal Reserve, the United States’ central banking institution, held its regular meeting of the Federal Open Market Committee (FOMC) on January 31, 2024. As anticipated, the FOMC decided to maintain the benchmark interest rate at its current level, marking the seventh consecutive meeting without a change. Following the meeting, Federal Reserve Chairman Jerome Powell addressed the media to provide insights into the committee’s decision and the economic outlook.

Powell began by acknowledging the recent economic data, which showed a strong labor market and a resilient economy. He noted that inflation had moderated somewhat but remained elevated, with the consumer price index (CPI) increasing by 6.5% year-over-year in December 2023. Despite these concerns, Powell emphasized that the FOMC believed that inflation would return to its 2% target over the course of the year.

Regarding the decision to keep interest rates steady, Powell explained that the committee saw the current economic conditions as consistent with its previous assessments. He noted that the labor market remained strong, with the unemployment rate at a historically low level, and that economic growth had remained robust. Powell also highlighted the ongoing progress in addressing supply chain disruptions and the gradual easing of pandemic-related restrictions.

However, Powell acknowledged that inflation remained a concern and that the FOMC would continue to closely monitor the situation. He emphasized that the committee would take appropriate action if necessary to ensure that inflation returned to its target level. Powell also noted that the FOMC would continue to reduce its asset purchases at a steady pace, with the goal of completing the tapering process by the end of 2024.

When asked about the potential impact of geopolitical tensions, such as the ongoing conflict in Ukraine, Powell expressed concern but noted that the economic impact was currently uncertain. He emphasized that the FOMC would continue to closely monitor global developments and adjust its policy as necessary to ensure price stability and maximum employment.

Powell also addressed questions about the ongoing recovery from the COVID-19 pandemic, noting that the economic outlook remained uncertain. He emphasized that the FOMC would continue to provide support to the economy as needed, but that the committee believed that the recovery was on track and that the economy was well-positioned for continued growth.

In conclusion, Federal Reserve Chairman Jerome Powell’s address to the media following the FOMC’s decision to keep interest rates steady provided valuable insights into the current economic conditions and the committee’s outlook for the future. Powell emphasized the strength of the labor market and the resilience of the economy, while acknowledging concerns about inflation and geopolitical tensions. He also highlighted the ongoing progress in addressing supply chain disruptions and the gradual easing of pandemic-related restrictions. The FOMC will continue to closely monitor economic conditions and adjust its policy as necessary to ensure price stability and maximum employment.