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Fed's Powell says aware of policy risks to workers, but cuts depend on inflation
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Fed's Powell says aware of policy risks to workers, but cuts depend on inflation
Mar 7, 2024 8:24 AM

WASHINGTON (Reuters) - Federal Reserve Chair Jerome Powell told U.S. lawmakers on Thursday the central bank was "well aware" of the risks its tough monetary policy posed to workers, but said rate cuts would depend on the economy evolving as the Fed expects, with continued lower inflation.

Powell, appearing before the Senate Banking Committee, was pressed by the panel's chair, Ohio Democrat Sherrod Brown, on why the Fed was not quicker to cut rates "to prevent workers from losing their jobs."

"We're well aware of that risk, of course, and very conscious of avoiding it," Powell said. "If what we expect and what we're seeing - continued strong growth, strong labor market...progress in bringing inflation down - if the economy evolves over that path, then we do think that the process of carefully removing restrictive...policy...can and will begin over the course of this year."

Powell's appearance in the Senate follows a hearing before the House Financial Services Committee on Wednesday at which he repeated that ongoing progress in lowering inflation was "not assured."

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