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Federal Reserve Chair Jerome Powell sought Wednesday to reassure the public that the Fed will raise interest rates high and fast enough to quell inflation, without tightening credit so much as to throttle the economy and cause a recession.
The Fed's primary goal is to reduce inflation, but the central bank still hopes for a “soft landing.”
Federal Reserve Chair Jerome Powell won praise for his deft leadership during the maelstrom of the pandemic recession. As threats to the U.S. economy have mounted, though, Powell has increasingly struck Fed watchers as much less sure-footed.
Inflation has proved higher and far more persistent than he or the Fed's staff economists had foreseen.
Concerns are growing among some that the Federal Reserve may tighten credit so much that it may cause a potential recession.