WASHINGTON (Reuters) – The Federal Reserve’s (Fed) determination to control inflation is “unconditional” but also comes with a risk of rising unemployment, U.S. central bank Chairman Jerome Powell said on Thursday. .
“We really need to restore price stability (…) because without that we cannot have a sustainable period of full employment,” he said during his hearing in the House of Representatives. UNITED STATES.
The chairman of the Fed has already spoken on Wednesday, but in the Senate, on the efforts made by the institution to bring down inflation that has become too high and which raises fears of a sharp slowdown in economic growth or a sharp increase in unemployment.
Jerome Powell had admitted to senators that a recession was “certainly a possibility” even if it was not the objective of the central bank.
Asked by members of the House of Representatives, however, he said on Thursday that he expected growth to accelerate in the second half.
The Fed Chairman also indicated that there was a risk that the measures taken could lead to a rise in unemployment, even if the rate is historically low.
“We don’t have precision tools (…) so there is a risk that unemployment will rise, from what is historically a low level however. A labor market with an unemployment rate of 4 .1% or 4.3% remains a very strong labor market,” Jerome Powell said.
The unemployment rate stood at 3.6% in May.
(Report Ann Saphir, Dan Burns and Lindsay Dunsmuir, French version Laetitia Volga, edited by Sophie Louet)
Copyright © 2022 Thomson Reuters