Chairman of the US Federal Reserve Jerome Powell made the remarks in a speech following the decision to halt interest rate hikes.
Wednesday, US Federal Reserve Chair Jerome Powell stated that the central bank is eager to reduce inflation to the 2% objective. He stated that nearly all policymakers believe rate increases will be necessary later in the year.
He made these remarks during a press conference after the decision to halt the interest rate increase. Earlier, Fed officials deemed it appropriate to maintain the present range of 5-5.25% for the interest rate while signaling that rate hikes may be possible later in 2023. However, the decline may be a precursor to a market rally.
Powell stated that inflation had somewhat’ moderated but acknowledged that high inflation pressures make it challenging to return inflation to the 2% target.
Officials at the US Federal Reserve anticipate inflation rates of 3.2% by the end of 2023 and 2.5% by the end of 2024, compared to the central bank’s target of 2%. In contrast, the officials anticipate core inflation to reach 2.6% by the end of 2024.
Possible additional rate increases
Fed officials cautioned that the central bank may still need to finish raising interest rates, despite the recent declines in inflation and the current pauses. This would increase market uncertainty until the end of 2023, which is advantageous for Bitcoin as investors prefer riskier assets on the cryptocurrency market.
Intriguingly, the majority of Fed officials anticipate rate declines in 2024. He clarified that the Fed did not decide to raise interest rates in July 2023, stating that the central bank will continue to make decisions meeting by meeting.
