America News Agency

Setting the stage for a two-day appearance on Capitol Hill this week, the central bank leader said the economy remains strong as does the labor market, despite some recent cooling. Powell cited some easing in inflation, which he said policymakers stay resolute in bringing down to their 2,0 percent goal.

“At the same time, in light of the progress made both in lowering inflation and in cooling the labour market over the past two years, elevated inflation is not the only risk we face,” he said in prepared remarks. “Reducing policy restraint too late or too little could unduly weaken economic activity and employment.”

The commentary coincides with the approaching first anniversary of the last time the Federal Open Market Committee raised benchmark interest rates.

The Fed’s overnight borrowing rate currently ranges between 5.25 percent and 5.50 percent, the highest level in some 23 years and the result of 11 consecutive hikes after inflation hit its highest level since the early 1980s.

Markets expect the Fed to begin cutting rates in September and likely follow up with another quarter percentage point reduction by the end of the year. Federal Open Market Committee (FOMC) members at their June meeting, however, indicated just one cut.