US Federal Reserve chairman Jerome Powell has again emphasised that the key focus of the central bank’s decision to start lifting interest rates and tighten monetary policy is to push down on wage demands.

This was the theme of his press conference last week announcing the shift in the Fed’s monetary policy, and it was further elaborated at an economic conference held on Monday.

In his address to the annual conference of the National Association for Business Economics (NABE) in Washington followed by a question-and-answer session, Powell continually returned to the issue of what he called a “hot” and “very tight” labour market.

Significantly, not once did he allude to the fact that, while nominal wage increases are higher than they have been in decades, they are still well below the level of inflation in the US, now at almost 8 percent and expected to go even higher in coming weeks.

Federal Reserve Board chairman Jerome…

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