Highlights From Fed Chair Powell’s Congressional Testimony: Day 1

On the first day of his testimony before Congress, chairman Jerome Powell stated that the Fed would use all available tools for as long as

Arslan Butt•Tuesday, September 22, 2020•1 min read

Highlights From Fed Chair Powell's Congressional Testimony: Day 1

On the first day of his testimony before Congress, chairman Jerome Powell stated that the Fed would use all available tools for as long as it takes to get the US economy back on track after the coronavirus pandemic driven downturn. He reiterated highlights from the Fed’s latest policy meeting when the central bank confirmed that interest rates would remain close to zero until employment levels rebound. In addition, Powell also maintained the Fed’s new shift in strategy to let inflation rise above the previous 2% target occasionally.

Powell confirmed that the housing sector in the US has rebounded while consumer spending stands at about 75% of pre-pandemic levels. However, he cautioned that economic activity and employment remain far lower than the period before the pandemic began and face significant uncertainty going forward.

In his speech, Powell maintained his outlook from before that the US dollar would need additional fiscal and monetary policy support to offset any long term damage from the pandemic.

Powell also discussed the central bank’s Main Street Lending program, adding, “Demand for Main Street loans may increase over time if the pandemic continues to affect the ability of businesses and nonprofits to access credit through normal channels and as other support programs expire.”

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ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.