U.S. FED: INFLATION FIGHT COULD BRING 'PAIN,' JOB LOSSES

Aug 26, 2022

By Bob Komsic

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(Jackson Hole, Wyoming) – With U.S. inflation showing signs of easing; falling 0.5% last month from June, settling at 6.3% in July, investors had hoped for a sign that the Federal Reserve Board may soon moderate its interest rate hikes later this year.
Instead, American central bank chair Jerome Powell says the Fed will continue sharply raising hikes, which will likely cause pain for Americans in the form of a weaker economy and job losses.
“These are the unfortunate costs of reducing inflation,” Powell said in a high-profile speech at the Fed’s annual economic symposium in Jackson Hole, Wyoming.
“But a failure to restore price stability would mean far greater pain.” 
North American stock markets declined following Powell’s remarks, and bond yields rose; a sign that investors foresee more large interest rate hikes ahead.  
Some on Wall Street expect the economy to fall into recession later this year or early next, after which they believe the Fed will reverse course and lower rates.  
(The Associated Press)
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