New York (USA), March 30 (ANI): The US Federal Reserve on Friday indicated that it was in no rush to cut interest rates.
In his address at an event hosted by the San Francisco Fed on Friday, US Fed Chairman Jerome Powell said “We don’t need to rush to cut.”
Powell further added that strong employment data buys the central bank more time to wait until inflation approaches 2 percent, CNN reported.
The US Fed chair also raised concerns about cutting rates too early.
“If we cut rates too soon, there is a chance that inflation will come back and we would have to come back and that would be very disruptive (to the economy),” he said.
CNN reported on Friday that the Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditure price index, rose 2.5 percent in the 12 months that ended in February, a faster pace than the 2.4 percent increase in prices. from January
In his address, Powell recognized the risks of leaving rates at their current levels.
“This is an economy that doesn’t feel like it’s suffering from the current level of tariffs,” Powell said.
The US Fed is trying to balance two risks: On the one hand, officials do not want to keep interest rates too high for too long, risking an unnecessary recession. On the other hand, they don’t want to cut interest rates too early, before inflation is fully under control, the New York Times reported.
Meanwhile in India, the RBI Monetary Policy Committee (MPC) is set to kick off its three-day meeting on interest rates and an analysis of the state of the economy on April 3 and will conclude on April 5.
The calendar of meetings for the MPC was released by the RBI on Friday. The MPC meeting scheduled for April 3 will be its first meeting after the kick-off of the new financial year FY2025 will start from April 1.
Most market analysts predicted that the Central Bank would maintain status quo on rates. (ANI)