US Federal Reserve Chairman Jerome Powell said today that the Fed is ready to “increase interest rates if necessary” and will continue its stringent monetary policy, until inflation moves towards the target of 2 per cent.
Addressing the Annual Central Bank Governors’ Meeting in Jackson Hole, Wyoming, Powell also emphasized that “sustainably reducing inflation to 2 per cent will require a period of economic growth below the trend as well as a slowing labour market”, which remains tight with the unemployment rate remaining low at about 3.6 per cent.
On the other hand, the number of Americans filing new applications for unemployment benefits declined last week as the labor market remained scarce despite the Federal Reserve raising interest rates.
The first-time applications for state unemployment benefits fell by 10,000 to 230 thousand after the amendment in the light of seasonal factors in the week ending August 19. The previous week’s data were amended by a thousand more requests than previously received.
Economists, polled by Reuters, had expected the number of applications to reach 240 thousand in the most recent week.
This comes at a time when sales of new US single-family homes rose in July, with a severe shortage of existing homes pushing buyers towards new units.
The Ministry of Commerce said yesterday that new home sales rose 4.4 per cent to a seasonally adjusted annual level of 714 thousand units last month.
