Economics
Powell Sees Muted Inflation Risk in ‘Extraordinary’ Economy
- Keeps central bank on track for gradual interest-rate hikes
- Fed chief calls recent wage increases ‘quite welcome’
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Federal Reserve Chairman Jerome Powell welcomed recent increases in Americans’ wages while expressing confidence that low unemployment won’t spur a takeoff in prices that would force him to hike interest rates aggressively.
“The rise in wages is broadly consistent with observed rates of price inflation and labor productivity growth and therefore does not point to an overheating labor market,” Powell said in a speech Tuesday in Boston. “Further, higher wage growth alone need not be inflationary.”