Jerome Powell warns Fed Reserve needs more time to battle stubborn inflation

Federal Reserve Chair Jerome Powell cautioned Tuesday that persistently elevated inflation will likely delay any Fed rate cuts until later this year because “recent data have clearly not given us greater confidence” that price increases are under control.

The most recent inflation reports “instead indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said during a panel discussion at the Wilson Center. “If higher inflation does persist, we can maintain the current level of restriction for as long as needed.”

The Fed chair’s comments suggested that without further evidence that inflation is falling, the central bank will likely carry out fewer than the three quarter-point reductions its officials had forecast during their most recent meeting in March.

Powell’s comments followed a speech earlier Tuesday by Fed Vice Chair Philip Jefferson, who also appeared to raise the prospect that the Fed would would not carry out three cuts this year in its benchmark rate, which stands at a multi-decade high after 11 rate hikes beginning two years ago.

This is a developing story. Please check back for updates.