US Federal Reserve Chairman Jerome Powell on Tuesday testified before the Senate Banking Committee.
Powell in his prepared testimony told Senators that inflation had been improving in recent months but more good data would strengthen the case for interest rate cuts.
“More good data would strengthen our confidence that inflation is moving sustainably toward 2%,” said Powell.
“After a lack of progress toward our 2% inflation objective in the early part of this year, the most recent monthly readings have shown modest further progress,” the Fed Chair said.
He also said: “Elevated inflation is not the only risk we face.”
“Reducing policy restraint too late or too little could unduly weaken economic activity and employment,” Powell added.
The Fed Chair’s testimony comes ahead of the latest inflation numbers on Thursday and Friday.
His comments indicate that the Federal Open Market Committee (FOMC) is likely to hold policy rates unchanged when it meets on July 30-31.
The US central bank has held its policy rate in a range of 5.25 per cent to 5.5 per cent, a more than two-decade high, for nearly a year.
“Reducing policy restraint too late or too little could unduly weaken economic activity and employment,” Powell added.
The Fed Chair’s testimony comes ahead of the latest inflation numbers on Thursday and Friday.
His comments indicate that the Federal Open Market Committee (FOMC) is likely to hold policy rates unchanged when it meets on July 30-31.
The US central bank has held its policy rate in a range of 5.25 per cent to 5.5 per cent, a more than two-decade high, for nearly a year.
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US stocks
US stock indices were mixed on Tuesday as Fed Chair Jerome Powell testified before the Congress.
At 10:05 a.m. ET, the Dow Jones Industrial Average was down 147.89 points, or 0.38 per cent, at 39,196.90, the S&P 500 was up 11.96 points, or 0.21 per cent, at 5,584.81, and the Nasdaq Composite was up 86.31 points, or 0.47 per cent, at 18,490.05.
Chip giant Nvidia stock jumped 4 per cent, while Applied Materials and Micron Technology rose 2 per cent and 3 per cent, respectively.
Chipmaker Intel climbed 3.5 per cent following Monday’s 6.2 per cent gain.
Shares of Meta Platforms and Amazon.com rose 0.9 per cent and 0.3 per cent, respectively.
Salesforce stock dropped 2 per cent.
The yield on the 10-year Treasury note edged up to 4.31 per cent from 4.28 per cent late on Monday.
