Saturday, August 23, 2025

Jerome Powell: Rates Will Likely Be Higher Than Previously Expected

It appears Fed Chair Jerome Powell isn’t satisfied after all with the supposed “disinflationary process” that he previously insisted is underway in response to the central bank’s fight against inflation.

In a series of prepared comments before Capitol Hill hearings beginning on Tuesday, Powell admitted that the economy still remains in overdrive, and that the current pace of quarter-point rate hikes just aren’t going to cut it anymore. “The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” he said. “If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.”

The central bank’s latest 25 basis-point rate hike brought the federal funds rate to a range between 4.5% and 4.75%. In the meantime, January inflation has moderately softened, but still remains substantially higher than economists’ expectations, while the labour market still remains at full employment. “We will continue to make our decisions meeting by meeting,” Powell explained. “Although inflation has been moderating in recent months, the process of getting inflation back down to 2% has a long way to go and is likely to be bumpy.”

Powell’s latest testimony marks the final series of public remarks on interest rates before FOMC members gather for their two-day policy meeting on March 21 and 22. Back in December, the Fed projected the fed-funds rate will sit somewhere between 5% and 5.5% this year and remain there until 2024. However, policy makers are expected to provide updated projections come the next meeting, with markets now forecasting the rate will hit around 5.5% in the second half of 2023 and remain there until the end of the year, according to projections from CME Group.


Information for this briefing was found via Reuters and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

A Medical Breakthrough the Market Overlooked | David Elsley – Cardiol Therapeutics

Why Grade Beats Size in Silver Mining | Frank Basa – Nord Precious Metals

Are Investors Missing the Start of the Next Commodity Supercycle? | Morgan Lekstrom – NexMetals

Recommended

Emerita Resources Expands El Cura Drill Program By 10,000 Metres As Deposit Remains Open For Expansion

ESGold Signs MOU For Tailings Project In Colombia With Grades Up To 42 g/t Gold, 280 g/t Silver

Related News

Throwing in the Towel: Workers Everywhere are Walking Out in Demand of Higher Wages

Workers around the world have had enough: thanks to surging inflation, minimal— if any— wage...

Friday, January 6, 2023, 03:45:00 PM

Turkey’s Central Bank Slashes Interest Rates AGAIN as Inflation Soars Above 80%

to the shock of markets and the rest of the developed world, Turkey’s central bank...

Friday, September 23, 2022, 03:10:55 PM

Inflation Has Already Arrived for the Goods that Americans Actually Need

Back in August, the Federal Reserve revealed a new model to meet inflation targets, called...

Friday, October 2, 2020, 11:31:00 AM

US Consumer Prices Rise 4% in May

After rising 4.9% year-over-year in April, US consumer prices continued their descent last month, increasing...

Tuesday, June 13, 2023, 08:36:06 AM

Bank of Canada Delivers Another Colossal 50 Basis-Point Rate Hike

Canada’s central bank embarked on yet another hawkish tightening cycle, this time raising its overnight...

Wednesday, June 1, 2022, 10:59:21 AM