“Very Dumb” Fed Chair Testifies To Congress
(ZH) – In his prepared remarks ahead of this morning’s Humphrey-Hawkins testimony to Congress, Fed Chair Powell reiterated his comments from last week’s FOMC that the central bank is in no rush to lower interest rates as officials wait for more clarity on the economic impact of President Donald Trump’s tariffs.
“The effects of tariffs will depend, among other things, on their ultimate level,” Powell said Tuesday in remarks prepared for delivery to Congress.
“For the time being, we are well positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance.”
His comments – with no a bit of dovishness – comes after three of his colleagues (Waller, Bowden, and Goolsbee) all hinted at rate cuts as soon as July in recent days.
Powell said the tariffs’ impact on inflation could be short-lived or possibly be more persistent.
“Expectations of that level, and thus of the related economic effects, reached a peak in April and have since declined,” Powell said in a statement that largely echoed remarks he delivered last week.
“Even so, increases in tariffs this year are likely to push up prices and weigh on economic activity.”
Avoiding the latter outcome “will depend on the size of the tariff effects, on how long it takes for them to pass through fully into prices and, ultimately, on keeping longer-term inflation expectations well anchored,” he said.
[Read Powell’s full prepared remarks, Click Here:]
President Trump chimed in (early):
“‘Too Late’ Jerome Powell, of the Fed, will be in Congress today in order to explain, among other things, why he is refusing to lower the Rate,” Trump said on social media early Tuesday.
“I hope Congress really works this very dumb, hardheaded person, over. We will be paying for his incompetence for many years to come.”
Economic data so far has shown limited impact from tariffs.
Does make you wonder about “Fed Independence”…
Powell: Inflation Has Eased Significantly but Remains Somewhat Elevated
is it somewhat less elevated than it was in Sept 2024 when you cut 50 bps to ram stocks higher into the election?
— zerohedge (@zerohedge) June 24, 2025
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