Powell says recession ‘a possibility’ but not likely – By Scott Horsley (NPR) / June 22, 2022
Federal Reserve chairman Jerome Powell says the central bank is committed to regaining control over inflation, even as he acknowledged the Fed has little power to address its most visible symptoms at the gas pump or the supermarket.
Powell addressed the Senate Banking Committee Wednesday, a week after the Fed ordered the largest interest rate increase since 1994. The central bank is under growing pressure to combat inflation, which hit a four-decade high of 8.6% in May.
“We need to get inflation back down to 2%,” Powell told lawmakers. “We’re using our tools to do that. And the public should believe that we will get inflation back down to 2% over time.”
Sen. Elizabeth Warren, D-Mass., cautioned that an abrupt increase in borrowing costs could produce a surge in layoffs, while doing little to untangle supply shocks that have driven up the price of gasoline and groceries.