Fed Chairman: Ready to further tighten monetary policy if conditions are right

According to the latest Federal Open Market Committee (FOMC) meeting minutes from the Federal Reserve, released on December 13th, the Fed has decided to continue slowing down the pace of interest rate hikes in December, keeping the federal funds rate target range between 5.25% and 5.50%. Powell noted that the committee is proceeding cautiously and cannot rule out the possibility of a rate hike at this time. This indicates that the Fed will not adjust the benchmark interest rate in the short term, while the earlier dot plot showed that the Fed will cut interest rates three times next year. Powell said that if conditions are appropriate, the policymakers are ready to further tighten monetary policy and do not want to rule out the possibility of further rate hikes. However, Powell himself believes that the possibility of a rate hike next year is small.Powell added that even if there is no economic recession, the Fed is willing to cut interest rates and will not wait until 2% inflation to cut rates, because that would be too late and exceed the target. Policy needs time to impact the economy.