Federal Reserve Chair Powell "Admits Mistake": Era of Prolonged Low Interest Rates Is Over

BlockBeats News, May 15, Federal Reserve Chairman Powell stated today in his opening remarks at the Thomas Laubach Research Conference that the Fed is adjusting its overall policy framework to address significant changes in inflation and interest rate outlook following the 2020 COVID-19 pandemic. Powell said, "The economic environment has changed significantly since 2020, and our review will reflect our assessment of these changes."

"Fed's Megaphone," Wall Street Journal reporter Nick Timiraos pointed out that the Fed adopted the current framework five years ago and began reviewing it this year, with this review unlikely to impact the way the Fed currently sets interest rates. Powell hinted that the higher real interest rates that emerged after the 2020 COVID-19 pandemic may render some elements of the Fed's current framework obsolete. (FXStreet)