Powell tells Congress the Fed is 'strongly committed' to bringing down inflation

cnbc.com:

Federal Reserve Chairman Jerome Powell told congressional lawmakers Wednesday that the central bank is determined to bringing down inflation and has the ability to make that happen.

«At the Fed, we understand the hardship high inflation is causing. We are strongly committed to bringing inflation back down, and we are moving expeditiously to do so,» the Fed chief said in remarks for the Senate Banking Committee. «We have both the tools we need and the resolve it will take to restore price stability on behalf of American families and businesses.»

Along with expressing resolve on inflation, Powell said economic conditions are generally favorable, with a strong labor market and persistently high demand.

However, he acknowledged that inflation is running too hot and needs to come down.

«Over coming months, we will be looking for compelling evidence that inflation is moving down, consistent with inflation returning to 2%,» Powell said. «We anticipate that ongoing rate increases will be appropriate; the pace of those changes will continue to depend on the incoming data and the evolving outlook for the economy.»

He noted that the war in Ukraine and Covid-linked shutdowns in China are adding to inflation pressures, and added that the problem is not unique to the U.S. but is affecting many global economies.

Powell's remarks are part of a congressionally mandated semiannual report on monetary policy – more commonly known in markets as the Humphrey Hawkins report and testimony, for the act which mandated them.

This is an especially delicate moment for Fed policy.

Over its past three meetings, the central bank has raised rates a cumulative 150 basis points – 1.5 percentage points – in an effort to tackle inflation that is running at