Powell signals recession may be price to pay for crushing inflation

Chair of the Federal Reserve Jerome Powell says a softer labour market may be necessary to bring down demand. (Image: Getty)

Bloomberg

Thu, 22 Sep 2022

By Catarina SaraivaFederal Reserve officials gave their clearest signal yet that they’re willing to tolerate a recession as the necessary trade-off for regaining control of inflation.Policymakers, criticised for being too late to realise the scale of the US inflation problem, are moving aggressively to catch up. They raised interest rates by 75 basis points on Wednesday for the third time in a row and forecast a further 1.25 percentage points of tightening before year-end. That was more hawkish than expected by economists. In additio...

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