U.S. economic activity expanded slightly from late February through early April and there were fears among firms that progress in lowering inflation would stall, a Federal Reserve survey showed on Wednesday,
His remarks represented a shift for Powell, who on March 7 had told a Senate committee that the Fed was “not far” from gaining the confidence it needed to cut rates.
Jerome Powell’s comments that firm inflation questioned whether rates will be cut without an unexpected economic slowdown are likely to lift the dollar in the near term, MUFG said.
The dollar eased from near 5-1/2-month highs on Wednesday as Federal Reserve officials reiterated the rate-cutting cycle was on hold pending new economic data, while the monetary easing outlook for major central banks was roughly unchanged.
Federal Reserve Chair Jerome Powell cautioned Tuesday that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year, opening the door to a period of higher-for-longer rates.
The dollar edged down but was near 5-1/2-month highs on Wednesday as Federal Reserve officials reiterated the rate-cutting cycle was on hold pending new economic data, while the pricing of the monetary easing outlook for G10 central banks was roughly unchanged.
The dollar was broadly steady on Wednesday, keeping the yen rooted near 34-year lows after comments from Federal Reserve officials, including Chair Jerome Powell, suggested U.S. interest rates are likely to stay higher for longer.