Economics
Powell Hammers Home Dovish Message in ‘Clean Break’ With Old Fed
- Fed holds rates near zero and signals no liftoff through 2023
- Growth forecasts upgraded but inflation bump seen as temporary
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Federal Reserve Chair Jerome Powell repeatedly stressed on Wednesday that the central bank won’t raise interest rates until the U.S. economy shows tangible evidence it has fully healed from Covid-19.
In doing so, he discarded a cardinal tenet of monetary policy to pre-emptively strike against inflation. It’s a significant shift that follows the Fed’s new framework announced last year that markets have tested in recent weeks by pushing yields higher.