Fed's Powell: Half-Point Hikes on Table in Next Couple of Meetings

The video addresses the high inflation rates affecting the American economy and the Federal Reserve's response to these challenges. It discusses the tight labor market, economic activity, and the impact of global events like the Russia-Ukraine conflict and COVID-19 on supply chains. The Federal Reserve's monetary policy actions, including interest rate hikes and balance sheet reductions, are outlined to restore price stability. The video concludes with a focus on the Fed's commitment to achieving maximum employment and stable prices, while being adaptable to changing economic conditions.

What is the primary reason for the Fed's focus on reducing inflation?

• To increase government revenue

• To ensure strong labor market conditions

• To decrease interest rates

• To boost international trade

What action did the FOMC take to address the tight labor market and high inflation?

• Introduced new taxes

• Decreased the policy interest rate

• Increased the policy interest rate

• Reduced government spending

Which external event is contributing to the rise in inflation according to the transcript?

• The Paris Agreement

• The US-China trade war

• The Russia-Ukraine conflict

• Brexit

What is the Fed's approach to handling its balance sheet?

• Increasing the size of the balance sheet

• Maintaining the current size of the balance sheet

• Reducing the size of the balance sheet predictably

• Eliminating the balance sheet entirely

How does the Fed plan to adjust its monetary policy in response to economic changes?

• By being flexible and responsive

• By focusing solely on employment

• By ignoring external factors

• By setting fixed interest rates

What is the Fed's overarching focus in its current economic strategy?

• Lowering taxes

• Boosting stock market performance

• Reducing inflation to 2%

• Increasing exports

What is the expected outcome of the Fed's monetary policy actions?

• Higher inflation rates

• Stable prices and maximum employment

• Lower economic growth

• Increased government debt