Economist's Insights

Powell Supports Raising Rising “Somewhat Further” in Written Testimony Released Ahead of Confirmation Hearing

Nov 27, 2017

In is written opening remarks, Fed Chair nominee Jay Powell said that he believes strongly in “preserving the Federal Reserve’s independent and nonpartisan status that is so vital” to the central bank achieving its dual mandate. On policy, Powell will tell the Senate Banking Committee that the Fed’s “aim is to sustain a strong jobs market with inflation moving gradually up toward our target” and that he expects “interest rates to rise somewhat further.” However, given the uncertainty that is inherent in economic activity, and therefore monetary policy, Powell also believes the Fed “must retain the flexibility to adjust our policies in response to economic developments” and “must be prepared to respond decisively and with appropriate force to new and unexpected threats to our nation’s financial stability and economic prosperity.” On regulation, Powell’s recent focus as a Fed Governor, he noted the Fed “will continue to consider appropriate ways to ease regulatory burdens while preserving core reforms–strong levels of capital and liquidity, stress testing, and resolution planning–so that banks can provide the credit to families and businesses necessary to sustain a prosperous economy.”