Fed Chairman Jerome Powell returned “60 minutes” on Sunday to tell Americans that the economy will start to grow strongly, but they shouldn’t expect central banks to start raising interest rates. .
Asked by CBS News’s Scott Pelley when the Fed will start to “hit the brakes”, Powell replied: “So what we said we will be looking at rate hikes as the market rallies. The move is basically complete and we have returned to maximum employment and inflation has returned to our 2% target and has been on track to grow above 2% for a while now.
“It will take a while until we fix that problem.”
The interview was filmed at Fed headquarters on Friday and aired on Sunday night.
The economy “appears to be at an inflection point,” Powell said, with a pandemic-induced weakness in the rearview mirror.
“I would say that the growth we expect for the second half of this year will be very strong. And job creation, I expect will be very strong, ”he said.
Forecasts at the Fed and Wall Street say the economy could grow between 6% and 7%, he said. That was the fastest growth rate since the early 1980s.
Staff told Fed officials in March they believe the economy is on track to see unemployment drop to “historic lows”. according to the minutes of the last Fed interest rate committee meeting, released last week.
Powell said the Fed does not need to raise interest rates because it is worried that inflation will rise from strong growth and job creation.
“We can wait and see real inflation emerge before raising rates,” said Powell.
“Now, we don’t want inflation to rise above 2% and go back, you know, the bad old inflation days we had when you and I were in college,” he said. .
“But at the same time, we have the ability to wait and see real inflation. And that’s what we intend to do, ”he added.