Fed’s Powell: ‘Frustrating’ that supply chain kinks aren’t getting better

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Sep 29 (Businesshala) – Federal Reserve Chairman Jerome Powell said on Wednesday it was “disappointing” that supply chain bottlenecks are not improving at this depth in recovery from the slowdown triggered by the coronavirus, and it appears That they will remain in place until next year and continue to fuel inflation.

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Powell, speaking at a virtual European Central Bank event with the heads of the ECB, the Bank of Japan and the Bank of England, also said the ongoing pandemic is a major factor driving the course of US monetary policy.

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“It is disappointing to acknowledge that getting people vaccinated and 18 months later keeping Delta under control is still the most important economic policy,” Powell said in response to a question on the US economic outlook. “And it’s also disappointing that bottlenecks and supply chain problems aren’t getting better, in fact on the margins apparently getting a little worse.”

“We see that continuing over the next year and keeping inflation going longer than we thought,” Powell said. “But ultimately the outlook for next year between my colleagues and myself at the Fed is a very strong year, with growth trending up and unemployment at a much lower level than it is now.”

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Fed officials at their meeting earlier this month downgraded their views of U.S. GDP growth for this year, but upgraded projections for next year, reflecting expectations that this year’s balance will increase. activity will be affected by supply issues and those restrictions will fade in 2022. .

Reporting by Dan Burns; Editing by Andrea Ricci

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