In the published message, FOMC informs that in The Economy Committee is assessed by a solid growth, inflation remains “anything high” and low unemployment. However, they noticed that there is still high uncertainty about the course, which economy.
The head of the Fed, Jerom Powell, talked about the details during the conference.
“The US economy opposes all forecasts indicating that it will weaken that we have heard in recent years, which is unusual. Time people repeat that it will weaken. In the end, this will happen, but now we do not see any signs in the short term” – he said.
This does not mean, however, that there are no challenges before the first economy of the world. The largest, which we hear all the time, is the issue of duties that US President Donald Trump introduced all over the world. Powell assessed during the conference that “uncertainty” associated with them all the time remains the main reason for keeping the feet unchanged.
“The size of the effects of customs, their duration and time that will take the appearance of these effects are highly uncertain. That is why we think that the right thing to do is to stay in the place where we are, “he said.
During the conference, Powell emphasized that customs are an inevitable increase in costs for enterprises and consumers.
“Everyone I know predict a significant increase in inflation in the coming months because of their duties, because someone has to pay for them” – said Powell.
“It will be someone from this chain, which I mentioned, between the producer, exporter, importer, retail seller, ultimately someone who will put it in some kind of good or simply a consumer who will buy it” – he said.
“In all this chain, people will try not to be those who may bear the costs, but ultimately the cost of customs must be paid. And some of this will fall on the final consumer” – said Powell.
Despite these uncertainties, Powell sees no reason to be unknown. He even stated that he was satisfied with the fact that “He can sit quietly until he finds out more“.
“For now, we are in a good position, To wait to learn more about the likely course that the economy will take before we consider any changes in our policy” – he said.
This is because, as he said, the influence of duties on inflation is not immediate.
“The US economy has not yet fully felt the influence of duties on prices for consumers,” was explained by the chairman of the FED.
“Customs need some time to get through the distribution chain to the end consumer. A good example of this is that the goods currently sold in retail stores could be imported a few months ago before the duties were introduced ” – he spoke.
However, prices will change.
“So we begin to see some effects and we expect that there will be more of them in the coming months,” said Powell.
