Fed Chair Jerome Powell signals job market
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The central bank retired a previous strategy and on Friday unveiled a new approach that updates how inflation and employment are balanced.
Inflation expectations derived from the bond market were rising on Friday, suggesting simmering concerns about future price gains despite Federal Reserve Chair Jerome Powell's willingness to consider cutting interest rates.
Most Federal Reserve officials highlighted inflation risks as outweighing concerns over the labor market at their meeting last month, as tariffs fueled a growing divide within the central bank’s rate-setting committee.
Minutes of the Federal Reserve’s July meeting show widespread concern over the slowing economy and the impacts of import tariffs.
While opening the door for a September interest rate cut, Fed Chair Jerome Powell stressed the central bank would not let inflation get out of control. While there are already signs that tariffs have begun to push up prices,
Federal Reserve Bank of Chicago President Austan Goolsbee said while some recent inflation readings have come in better than expected, he hopes one “dangerous” data point is just a blip.
The minutes of the rate-setting Federal Open Market Committee, published on Wednesday, showed that “some [members] noted that it would not be feasible or appropriate to wait for complete clarity on the tariffs’ effects on inflation before adjusting the stance of monetary policy”.
South Africa's rand was little moved on Wednesday, despite the country's highest inflation reading for 10 months, as investors awaited minutes from the Fed's July meeting and a symposium later this week that could provide U.