Fed’s Powell Predicts Further ‘Restriction,’ Including Rate Hikes at Consecutive Meetings

Federal Reserve Board Chairman Jerome Powell speaks during a news conference following the Federal Open Market Committee meeting, at the Federal Reserve in Washington on June 14, 2023. Mandel Ngan/AFP via Getty Images

Federal Reserve Chair Jerome Powell told a European Central Bank forum that the U.S. economy should expect more monetary policy restrictions to come and that inflation won’t return to its 2 percent target for a couple of more years.

During a panel discussion with his central bank counterparts, Powell said that policy hasn’t been restrictive for a long time. When the institution started its quantitative tightening campaign in March, real (inflation-adjusted) interest rates were negative and only recently touched positive territory.