Federal Reserve Chair Jerome Powell is expected to double down on his message that there’s no rush to cut interest rates, especially after fresh inflation data showed that price pressures persist.
Powell is headed to Capitol Hill, where he’ll deliver his semiannual monetary policy testimony to a House committee on Wednesday and a Senate panel on Thursday. The US central bank chief and nearly all of his colleagues have said in recent weeks that they can afford to be patient in deciding when to cut rates given underlying strength in the US economy.
The “danger of moving too soon is that the job’s not quite done, and that the really good readings we’ve had for the last six months somehow turn out not to be a true indicator of where inflation’s heading,” Powell said in an interview with CBS’s 60 Minutes on Feb 5.
That cautious approach has been validated in recent weeks by data showing inflation picked up last month. But it’s not likely to satisfy Democrats, who are anxious about how the path of rates could affect the November presidential election and down-ballot races.
They’re expected to press the Fed chief on why officials are keeping borrowing costs so high, risking damage to the economy, when they’ve made so much progress on inflation.
The data highlight for the week will be the monthly jobs report on Friday. Economists project payrolls growth moderated in February to 200,000 following a 353,000 surge a month earlier that was the largest in a year. The jobless rate is seen holding at 3.7%, while hourly earnings growth probably cooled.
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On Wednesday, the Fed will issue its Beige Book survey of regional business contacts from across the country. Other data in the coming week include separate February surveys of purchasing managers at service providers, as well as figures on the January trade balance and job openings.
