Fed Chair Powell Holds Off on Lowering Interest Rates Despite Wall Street’s Pressure: US Economy Remains Strong

The US Federal Reserve is not in a rush to lower interest rates, according to Fed Chair Jerome Powell. Despite Wall Street’s eagerness for a drop in rates, Powell stated on Friday that there is no need to act quickly. This comes after the central bank’s preferred measure of underlying inflation showed a decrease of 0.3% in February, indicating that prices are cooling down but still high enough to warrant caution.

Powell emphasized that the strong growth of the US economy and robust labor market allow for a more confident approach to inflation before making the decision to cut rates. Recent economic data has reassured analysts that the American economy remains strong following a period of rate hikes over the past two years. Inflation-adjusted consumer spending has surpassed expectations, fueled by a significant increase in wages.

Despite warnings of a potential tech bubble fueled by artificial intelligence, traders are pushing stocks higher. The equities market hit a record high this week, capping off a quarter of significant gains. Chris Zaccarelli of Independent Advisor Alliance noted that investors are more focused on the strength of the economy and consumer resilience than the timing of potential rate cuts by the Fed. The S&P 500 continues to perform well despite concerns from skeptics.