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Jerome Powell believes high inflation is temporary – how are interest rates affected?

Jerome Powell believes high inflation is temporary – how are interest rates affected? By Kelsey Ramirez article Federal Reserve Chair Jerome Powell says rising inflation is temporary. Here s what that means for interest rates. (iStock) Federal Reserve Chair Jerome Powell said in his testimony to Congress on July 15 that rising inflation is temporary, amid growing concerns that the economy is overheating. Inflation has increased notably and will likely remain elevated in coming months before moderating. Inflation is being temporarily boosted by base effects, as the sharp pandemic-related price declines from last spring drop out of the 12-month calculation, Powell said. In addition, strong demand in sectors where production bottlenecks or other supply constraints have limited production has led to especially rapid price increases for some goods and services, which should partially reverse as the effects of the bottlenecks unwind.

Jerome Powell believes high inflation is temporary – how are interest rates affected?

Jerome Powell believes high inflation is temporary – how are interest rates affected? By Kelsey Ramirez article Federal Reserve Chair Jerome Powell says rising inflation is temporary. Here s what that means for interest rates. (iStock) Federal Reserve Chair Jerome Powell said in his testimony to Congress on July 15 that rising inflation is temporary, amid growing concerns that the economy is overheating. Inflation has increased notably and will likely remain elevated in coming months before moderating. Inflation is being temporarily boosted by base effects, as the sharp pandemic-related price declines from last spring drop out of the 12-month calculation, Powell said. In addition, strong demand in sectors where production bottlenecks or other supply constraints have limited production has led to especially rapid price increases for some goods and services, which should partially reverse as the effects of the bottlenecks unwind.

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