Fed's Powell: Economy is doing very well

Economy 6/13/2018, 8:51 PM
Fed's Powell: Economy is doing very well

Following the decision of the Federal Reserve to raise its interest rates by 0.25 points, the governor of the American central bank Jerome Powell said in a press conference on Wednesday that "economy is doing very well," as the unemployment and inflation remain low. The fiscal policy has been boosting the economy, and the overall financial conditions are accommodative. He stated that the steady economic growth, with a rise in household spending, contributes to a favorable growth outlook.

The permanent voter on the Federal Open Market Committee (FOMC) said that "gradually returning interest rates to a normal level is a way Federal Reserve can help American households strive."

The FOMC predicts the gross domestic product (GDP) growth to be 2.8% this year, and to subside to 2.4% next year and 2% in 2020. In regards to unemployment, the expectation is that the job market will remain strong, with unemployment going down to 3.6% this year, and decreasing further to 3.5% in next two years. The longer run goal for the inflation remains 2%, while the rate-setter said the rate is expected to be 2.10% in 2018, 2019 and 2020, slightly lower than previously predicted.

In a statement earlier, the Federal Reserve announced two more interest rate hikes by the end of the year.

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