Expectations of Inflation to Stay

Federal Reserve Board Chairman Jerome Powell speaks during a news conference in Washington, DC, on July 27, 2022. - The US Federal Reserve on July 27 again raised the benchmark interest rate by three-quarters of a percentage point in its ongoing battle to tamp down raging price pressures that are squeezing American families. (Photo by MANDEL NGAN / AFP) (Photo by MANDEL NGAN/AFP via Getty Images)

A recession could be sparked by the Fed’s initiative to reduce the highest inflation in four decades. Blame-shifting in Washington has been triggered by the persistence of rising inflation. Federal Reserve Chair, Jerome Powell’s remarks represent a sharp contrast to those he made at the same conference the previous year. Numerous investors had predicted that the central bank will start reducing borrowing prices in 2019.

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