June 23, 2023 -WASHINGTON (AP) — Chair Jerome Powell reiterated Thursday that the Federal Reserve will likely raise interest rates at least once more this year because of persistently high inflation in the economy’s service sector and the surprisingly tight job market.
Speaking to a Senate committee, Powell noted that “inflation has moderated somewhat since the middle of last year.” Still, the Fed chair stressed, “inflation pressures continue to run high.”
Powell was testifying to the Senate Banking Committee on the second day of semi-annual testimony to Congress. On Wednesday, he addressed the House Financial Services Committee and sounded a similar message that some further rate hikes are likely coming this year.
On Thursday, Powell noted that “nearly all″ Fed policymakers ”expect that it will be appropriate to raise interest rates somewhat further by the end of the year.″
In May, consumer prices were up 4% in May compared with 12 months earlier, down from a year-over-year peak of 9.1% in June 2022, but still double the Fed’s 2% inflation target.