Powell speech: January and February inflation numbers did not add to our confidence

Federal Reserve Chairman Jerome Powell explains the decision to leave the policy rate, federal funds rate, unchanged at the range of 5.25-5.5% and responds to questions in the post-meeting press conference.

Key quotes

"Discussed balance sheet at this meeting."

"We discussed issues related to slowing pace of decline in holdings."

"Our general sense is we will start run off fairly soon."

"Slowing pace of runoff will ensure smooth transition, mitigating chance of money market stress."

"Will limit risk to money market volatility."

"Economy is performing well."

"Projections do not mean higher tolerance for inflation."

"Inflation data came in a little bit higher than expected. Nevertheless, we continue to make good progress on bringing inflation down."

"There's some confidence that lower market rent increases in housing will show up over time."

"I assume we will continue to see goods prices continue into a new equilibrium."

"The risks are really two-sided now."

"First rate cut is therefore consequential."

"We can approach that question carefully and let the data speak."

"January CPI and PCE numbers were quite high but could have been due to seasonal adjustments."

"January inflation numbers were quite high but reason to think there were seasonal affects there."

"February was also high, but not terribly."

"Taking January and February together have not changed the overall story."

"It will be a bumpy path."

"Those January and February inflation numbers did not add to our confidence."

"We are not going to overreact to these two months of data; nor ignore them."

About Jerome Powell (via Federalreserve.gov)

"Jerome H. Powell first took office as Chair of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. He was reappointed to the office and sworn in for a second four-year term on May 23, 2022. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028."