Yesterday, Federal Reserve Chair Jerome Powell addressed the public in a post-FOMC press conference, discussing the Federal Reserve’s ongoing efforts to manage inflation and economic activity. Powell emphasized that while inflation has shown signs of easing from its previous highs, it remains above the desired 2% target, underscoring the uncertain path forward and the non-assured nature of continued progress in inflation reduction. He reassured the public of the Federal Reserve’s commitment to achieving stable prices, highlighting the decision to maintain the policy interest rate unchanged and to continue reducing securities holdings.

Powell pointed out the significant tightening of monetary policy over the past two years, noting its impact on economic activity and inflation. He reported recent economic indicators suggesting robust activity, with GDP growth solid in the last quarter and throughout the year, bolstered by consumer demand and improved supply conditions. However, he also mentioned subdued housing sector activity and the dampening effect of high interest rates on business investment.

The labor market remains tight, according to Powell, but is showing signs of better balance between supply and demand, with average monthly job gains moderating to a healthy level and the unemployment rate staying low. He noted easing nominal wage growth and a narrowing gap between job vacancies and available workers, yet acknowledged that labor demand still exceeds supply.

On inflation, Powell remarked on the notable easing over the past year but stressed the need for sustained evidence of inflation moving toward the Fed’s goal. He assured that the Federal Reserve’s actions are guided by its mandate to promote stable prices and maximum employment, acknowledging the hardship high inflation causes, particularly for those least able to bear it.

Powell indicated that the current policy rate is likely at its peak for this tightening cycle, with potential adjustments depending on economic developments. He emphasized the Fed’s readiness to maintain or adjust its policy stance as needed, aiming to ensure progress towards the 2% inflation goal while balancing the risks of weakening economic activity and employment.

The crypto market experienced a modest decline following Powell’s speech, which suggests that it was hoping for a more dovish message from the Fed Chair.

At the time of writing, Bitcoin is trading at around $42,118, down 1.4% in the past 24-hour period.