Powell Says Fed 'Well Positioned' To Wait For 'Greater Clarity' About Impact Of Trump's Policies

(RTTNews) - Citing uncertainty about the effects of President Donald Trump's policy changes, Federal Reserve Chair Jerome Powell reiterated Friday that the central bank does not "need to be in a hurry" to adjusted interest rates.

Powell argued during remarks at the University of Chicago Booth School of Business 2025 U.S. Monetary Policy Forum that the Fed is "well positioned to wait for greater clarity" about the impact of Trump's policy changes.

"If the economy remains strong but inflation does not continue to move sustainably toward 2 percent, we can maintain policy restraint for longer," Powell said. "If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly."

He added, "Our current policy stance is well positioned to deal with the risks and uncertainties that we face in pursuing both sides of our dual mandate."

In late January, the Fed announced its widely expected decision to leave interest rates unchanged after cutting rates for three straight meetings.

The central bank's next monetary policy meeting is scheduled for March 18-19, when Fed officials will also provide their latest projections for rates, inflation and the economy.

CME Group's FedWatch Tool is currently indicating a 95.0 percent chance the Fed will once again leave rates unchanged.

During his remarks, Powell also referenced this morning's closely watched monthly jobs report, which showed employers added 151,000 jobs in February and the unemployment rate ticked up to 4.1 percent.

Powell said the data shows the labor market is "solid and broadly in balance" and "not a significant source of inflationary pressure."

The Fed chief also acknowledged recent indicators point to a possible moderation in consumer spending as well as heightened uncertainty about the economic outlook.

"It remains to be seen how these developments might affect future spending and investment. Sentiment readings have not been a good predictor of consumption growth in recent years," he said. "We continue to carefully monitor a variety of indicators of household and business spending."

Powell also noted the path to sustainably returning inflation to the Fed's 2 percent target has been bumpy and said that is expected to continue.

"We pay close attention to a broad range of measures of inflation expectations, and some near-term measures have recently moved up," Powell said. "We see this in both market- and survey-based measures, and survey respondents, both consumers and businesses, are mentioning tariffs as a driving factor."

He added, "Beyond the next year or so, however, most measures of longer-term expectations remain stable and consistent with our 2 percent inflation goal."

Powell stressed the Fed is "intently focused" on its dual mandate of maximum employment and stable prices and argued the current policy stance is well positioned to deal with the risks and uncertainties faced pursuing both sides.