While speaking at an online event hosted by the Princeton Bendheim Center for Finance, the President of the FOMC, Jerome Powell, said they need to see inflation rise above 2% for a while for the new framework to be credible for the public.
Market reaction
He dollar continues to weaken in front of his rivals during Powell’s speech. At time of writing, the US Dollar Index was down 0.23% daily to 90.12.
Featured statements:
“The flexible average inflation target means that we have not tied ourselves to a mathematical formula“.
“We want inflation expectations to be well anchored at 2%.”
“We announce the framework in which there is evidence that market participants have changed expectations to be consistent with guidance.”
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