Powell's Cautious Approach to Interest Rates

Federal Reserve Chair Jerome Powell has emphasized a cautious approach to adjusting interest rates, stating there is no urgency to lower them. Despite recent inflation near the 2% target, Powell insists on a careful evaluation of economic data before making any changes.

His remarks have tempered market expectations of a rate cut in December, impacting indices like the S&P 500 and Dow Jones. Powell's commitment to the Fed's independence remains firm, highlighting its role in managing inflation without external pressures.

He believes that central bank autonomy is crucial for economic stability, as demonstrated by historical precedents. Powell also acknowledged the importance of addressing the US fiscal deficit, noting its unsustainable trajectory despite current full employment.

While he refrained from commenting on specific policies proposed by President Trump, Powell assured that the Federal Reserve would evaluate their economic impact cautiously. His remarks have influenced financial markets, with Bitcoin and other investments reacting to the potential delay in rate cuts.

Powell's focus remains on maintaining economic stability and achieving long-term inflation goals, underscoring the significance of deliberate policy decisions.