Federal Reserve Chairman Jerome Powell will present his “semi-annual monetary policy report” to the House Financial Services Committee yesterday and today.
Powell, who gave his first presentation yesterday, made an important statement on many topics, from interest rate cuts to cryptocurrency.
Therefore, the Fed chair said tariffs will increase inflation in the coming months, but added that he is supporting interest rate cuts later this year.
At this point, Powell said tariffs will affect inflation over the summer months, and that the effects could be short-lived or long-term.
“The FOMC's obligation is to secure long-term inflation expectations at 2% and prevent one increase in price levels from becoming a continuous inflation problem,” Powell said.
Powell said the economy has plenty of room to cut interest rates if necessary.
Powell said current interest rates are high enough to guarantee interest rate reductions, but they are ready to take action if the impact of revenue and tariffs is short-lived, as the data suggests.
“I think we will begin to see the impact of tariffs on data inflation in the summer, June and July.
We see that inflation is not as strong as expected, and tariffs do not have much impact on inflation. If this occurs, you can lower your interest rates faster.
On the other hand, if we find out that inflation is high or that the labour market remains strong, we will probably act later.
However, most Fed members believe that interest rates should be cut towards the end of the year. ”
The Fed does not have authority over cryptocurrency!
Federal Reserve Chairman Jerome Powell also spoke about Bitcoin (BTC) and cryptocurrency. At this point, Powell said the Fed cannot and will not request permission to purchase the code.
Powell added that the Fed cannot legally purchase cryptocurrency and has not considered seeking such authority.
However, he said that banks can provide cryptocurrency services as long as security is guaranteed and they operate freely in this area.
Powell said in addition to his code statement, the dollar will remain a reserve for a long time.
*This is not investment advice.
