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The Federal Reserve decided on 2% average inflation

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Miguel A. Rodriguez
Miguel A. Rodriguez
14 září 2020
The Federal Reserve adopted new strategies to overcome the pandemic’s effects

The long-awaited speech of the US #Federal #Reserve Chairman Jerome Powell finally brought some clarity regarding the future of the USA's economic state.

The new measures announced by Jerome Powell are focusing on bringing inflation back to a healthy level,” letting it run above 2% for some period of time.” Moreover, in the future, the focus will be on creating a robust job market that can be supported “without causing an outbreak in inflation.” But, despite the touted robust labor market, unemployment might stay elevated for a while.

From the experts' point of view, the support for the labor market is sudden because generations ago, a strong labor market meant high inflation, and also an increase in interest rates was in sight. 

Powell’s economic outlook is optimistic, expecting the recovery that started in May and June to continue throughout the year “with stops and starts.” 

After the meeting, in after-hours trading, USA30 added 260 points. 

Read more about the pandemic’s effects over the American economy here!

Sources: reuters.com, marketwatch.com


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Miguel A. Rodriguez
Miguel A. Rodriguez
financial_writer

Miguel worked for major financial institutions such as Banco Santander, and Banco Central-Hispano. He is a published author of currency trading books.