He Federal Reserve Chairman Jerome Powelltakes part in a moderated debate with the president of De Nederlandsche Bank (DNB), Klaas Knot, at the Annual General Meeting of the Association of Foreign Banks in Amsterdam.
Featured Statements
“The US economy has performed very well.”
“The U.S. economy has a very strong labor market.”
“Households are in good financial shape.”
“Consumer spending and business investment remain strong.”
“There continue to be labor shortages in many industries.”
“Overall, it's a good picture looking at the US economic data so far.”
“The labor market is once again more balanced.”
“The labor market is now as tight as it was before the pandemic.”
“Signs of gradual cooling in the labor market, with supply and demand in better balance.”
“Inflation in the first quarter stood out for the lack of progress.”
“We do not expect a smooth path in terms of inflation, we have to be patient and let politics do its job.”
“We expect continued GDP growth of 2% or higher.”
“We expect the labor market to continue to rebalance, but to remain strong.”
“We expect inflation to fall again to levels more similar to last year.”
“Confidence that inflation will fall again is lower than it was. My confidence in this regard is not as high as before.“.
“The Production Price Index reading was quite mixed“.
“Businesses continue to report labor shortages.”
“The restrictive policy may take longer than expected to lower inflation, but we will return it to 2%.”
“Is question of maintaining politics at the current pace for longer“.
“I don't think it's likely that the next move will be a rate hike, it's more likely that we'll keep policy where it is.”
“Housing inflation has been a bit of a conundrum.”
“Current rent increases have been low for some time, and are not reflected in renewal contracts.”
“The delays between the decline in market rates and their appearance are longer than we thought.”
Market reaction
The US dollar remains under modest downward pressure following these comments. At press time, the US Dollar Index was down 0.2% on the day, standing at 105.00.
Frequently asked questions about the Fed
What does the Federal Reserve do and how does it affect the dollar?
The monetary policy of the United States is directed by the Federal Reserve (Fed). The Fed has two mandates: achieving price stability and promoting full employment. Your main tool to achieve these objectives is to adjust interest rates.
When prices rise too quickly and inflation exceeds the Federal Reserve's 2% target, it raises interest rates, raising borrowing costs throughout the economy. This translates into a strengthening of the US Dollar (USD), as it makes the United States a more attractive place for international investors to place their money.
When inflation falls below 2% or the unemployment rate is too high, the Federal Reserve can lower interest rates to encourage borrowing, which weighs on the greenback.
How often does the Federal Reserve hold monetary policy meetings?
The Federal Reserve (Fed) holds eight meetings a year, in which the Federal Open Market Committee (FOMC) evaluates the economic situation and makes monetary policy decisions.
The FOMC is made up of twelve Federal Reserve officials: the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the eleven presidents of the regional Reserve banks, who serve for one year on a rotating basis.
What is Quantitative Easing (QE) and how does it affect the USD?
In extreme situations, the Federal Reserve can resort to a policy called Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit into a clogged financial system.
It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed's weapon of choice during the Great Financial Crisis of 2008. It involves the Fed printing more dollars and using them to buy high-quality bonds from financial institutions. QE usually weakens the US dollar.
What is Quantitative Tightening (QT) and how does it affect the US Dollar?
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the capital of the maturing bonds it has in its portfolio to buy new bonds. It is usually positive for the value of the US Dollar.
Source: Fx Street

I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.