Federal Reserve to announce latest interest rate decision
April 29 (UPI) — Federal Reserve Chairman Jerome Powell said Wednesday that benchmark interest rates will stay steady as he makes plans to remain on the board of governors for the time being.
Powell took to the podium for the last time as chairman to announce that the Federal Open Market Committee will hold its target interest rate unchanged at 3.5% to 3.75%. It is the third consecutive time that the Federal Reserve has kept interest rates firm.
“The U.S. economy has been expanding at a solid pace,” Powell said. “While job gains have remained low, the unemployment rate has been little changed in recent months. Inflation has moved up and has elevated, in part reflecting the recent increase in global energy prices.”
The chairman said the Federal Reserve will continue closely monitoring the effects of the Iran war, noting that it has greatly contributed to rising energy prices in the United States.
“Developments in the Middle East are contributing to a high level of uncertainty about the economic outlook and we will remain attentive to risks to both sides of our dual mandate,” Powell said.
The Federal Reserve elected to hold interest rates firm in its other two decisions this year while seeking to ease overall inflation to a rate of 2% annually. Inflation has remained well above 2% for five years.
The current rate of inflation in the United States is 3.3%.
The war in Iran has dealt a blow to prices in the United States and abroad, causing energy prices to contribute heavily to overall inflation. Energy prices jumped 10.9% in March after the United States began strikes on Iran, the U.S. Bureau of Labor Statistics reported.
Oil prices have climbed for 12 consecutive days coming into Wednesday as peace talks with Iran have stalled.
The announcement will be the last under Powell’s official term as chairman. President Donald Trump’s nominee Kevin Warsh is currently going through the Senate confirmation process.
When Powell’s term as chairman ends, he said he plans to stay on on the Fed’s board of governors but “keep a low profile.” He said he welcomed the announcement on Friday that U.S. attorney for the District of Columbia Jeanine Pirro is closing her criminal investigation into him over the renovation of the Marriner S. Eccles Federal Reserve Board Building.
“She also noted, however, that she would not hesitate to restart the investigation,” Powell said. “I’ve said that I will not leave the board until this investigation is well and truly over with transparency and finality and I stand by that. I’m encouraged by recent developments and I’m watching the remaining steps in this process carefully.”
Powell acknowledged that Wednesday’s was his last address on the FOMC’s interest rate decisions. He said he is confident that the Federal Reserve “will continue to do its work with objectivity, integrity and a deep commitment to serve the American people.”