Federal Reserve Chair Jerome Powell told a European Central Bank (ECB) forum that the U.S. economy should expect more monetary policy restrictions to come and inflation will not return to its 2 percent target for a couple of more years.
During a panel discussion with his central bank counterparts, Powell explained that policy has not been restrictive for a long time. When the institution started its quantitative tightening campaign in March, real (inflation-adjusted) interest rates were negative and only recently touched positive territory.
“We’ve now moved up to where we actually are in restrictive territory, but we haven’t been there very long,” Powell said at the event in Sintra, Portugal, on June 28. “We believe there’s more restriction coming.”…