Time for the Fed to Cut Rates

Source: Beat The Press
by Dean Baker

“Federal Reserve Board Chair Jerome Powell has been saying for some time that he needs to see more evidence that inflation is under control before he lowers interest rates. We can never be certain of where the economy is going so it’s understandable that he remains worried that inflation could reaccelerate. However, there are risks in the opposite direction as well, which Powell has explicitly recognized in the past. He has stated that the Fed has an obligation to maximize employment and said that this part of the Fed’s mandate needs to be taken as seriously as its commitment to price stability. That is why many of us where [sic] happy see President Biden reappointed him as Fed chair. But he has to act now to show this commitment.” (07/07/24)