In a big reversal from just months ago, FederalReserve staff no longer expect a recession, Fed Chairman Jerome Powell said Wednesday.
Powell's comments came during a press conference following the Fed's announcement that it is hiking its interest rate target and bolster the notion that the central bank can pull off an elusive “soft landing” — that is, bringing down inflation without causing a recession.“The staff now has a noticeable slowdown in growth starting later this year in the forecast, but given the resilience of the economy recently, they are no longer forecasting a recession,” Powell told reporters.
“We’ve seen so far the beginnings of disinflation without any real cost to the labor market and that’s a really good thing,” Powell said. Recent economic news has buoyed the optimism of economists and investors, particularly reports for June that showed the rate of inflation has been meaningfully falling.
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