July 26, 2023
Jerome H. Powell
July 26, 2023 FOMC Press Conference
- The chair said the FOMC had raised the policy rate by 5¼ percentage points since early last year.
- The chair said the June CPI report came in a bit better than expectations but cautioned it was only one month's data.
- The chair said it was possible the FOMC would raise rates again at the September meeting or choose to hold steady, depending on the data.
- The chair said the unemployment rate was the same as when the Fed began lifting off in March 2022, at 3.6 percent.
- The chair said the historical record suggests that slowing the economy to bring down inflation tends to result in some softening in labor market conditions.
From the opening statement
Press conference
CHAIR POWELL. Good afternoon. My colleagues and I remain squarely focused on our dual mandate to promote maximum employment and stable prices for the American people. We understand the hardship that high inflation is causing, and we remain strongly committed to bringing inflation back down to our 2 percent goal. Price stability is the responsibility of the Federal Reserve. Without price stability, the economy doesn’t work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all.
Since early last year, the FOMC has significantly tightened the stance of monetary policy. Today we took another step by raising our policy interest rate ¼ percentage point, and we are continuing to reduce our securities holdings at a brisk pace. We’ve covered a lot of ground, and the full effects of our tightening have yet to be felt. Looking ahead, we will continue to take a data-dependent approach in determining the extent of additional policy firming that may be appropriate. I’ll have more to say about monetary policy after briefly reviewing economic developments.
Recent indicators suggest that economic activity has been expanding at a moderate pace. Growth in consumer spending appears to have slowed from earlier in the year. Although activity in the housing sector has picked up somewhat, it remains well below levels of a year ago, largely reflecting higher mortgage rates. And higher interest rates and slower output growth also appear to be weighing on business fixed investment.