The United States Federal Reserve is "aware of the risk that we would hang on too long" to the currently restrictive monetary policy and is "very focused on not making that mistake," Fed Chair Jerome Powell said on Wednesday. The Fed should be "reducing restriction on the economy well before" inflation is down to 2% "so you don't overshoot," he underscored.
Speaking to reporters, Powell noted that the central bank will be following future inflation, unemployment and economic growth numbers to determine when the monetary policy would potentially change. "We see good evidence and good reason to believe that growth will come in lower next year" but "all three of the categories of core [inflation] are now contributing" to the deceleration in inflation, he pointed out.
