“We will use all our tools to support the economy and the robust labor market and to prevent higher inflation from becoming entrenched.” So Jerome Powell, chairman of the Federal Reserve, in the speech scheduled for today, in front of the Banking Commission of the Senate.
Excerpts from his speech have been released in the last few hours.
“Today the economy is expanding at the fastest pace in recent years, and the job market is solid,” Powell told the Senate in the hearing scheduled for his confirmation as president of the US central bank. However, “challenges” remain, including the high cost of living caused by inflation:
“The economy has gained strength rapidly despite the ongoing pandemic, causing persistent bottlenecks and imbalances between supply and demand, and therefore causing high inflation”, emphasizes the Fed’s number one, in the intervention planned for 4 pm Italian time at the US Congress.
In addition to Powell’s speech, which is decisive for the performance of rates and the US stock exchange, tomorrow, Wednesday 12 January, will be the publication of the data relating to inflation measured by the consumer price index, which economists expect on average to be jumped 7.1% year-on-year, according to Dow Jones expectations. The latest data, relating to the month of November, indicated a jump in the index equal to + 6.8% on an annual basis, to the record of the last 39 years.
Powell will of course also talk about the US banking system: “We have increased the demands for liquidity and capital for the largest banks and, at the moment, the capital and liquidity levels of our largest and most systematically important banks are traveling to the records of the last decades “.