Fed has to 'bring those rates down': Rep. Maxine Waters
As Federal Reserve Chair Jerome Powell concludes his first day of testimony before Congress, Yahoo Finance's Jennifer Schonberger joins the Live Show to provide an in-depth analysis of the key takeaways.
Schonberger highlights Powell's emphasis on the notion that inflation rates do not necessarily need to return to the 2% target before the Fed considers cutting rates. Instead, Powell stressed the importance of observing more positive economic data on inflation to pave the way for potential rate reductions.
Additionally, Schonberger shares her conversation with Congresswoman Maxine Waters, who expressed she is "absolutely convinced" interest rates need to be lowered. Waters cited the immense pressure consumers are facing due to the rising costs of "necessities like food," underscoring the urgency for the Fed to provide relief.
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Editor's note: This article was written by Angel Smith
Video Transcript
JULIE HYMAN: Investors, of course, keeping an eye on commentary from Fed Chair Jerome Powell as he wraps up his first day of congressional testimony. Jennifer Schonberger is on Capitol Hill with the latest. Jen, bring us the highlights.
JENNIFER SCHONBERGER: Julie, in his first day of semiannual testimony before Congress, Fed Chair Powell told house lawmakers that the Fed will cut rates at some point this year and said that he expects broad material changes to the Fed's proposed capital requirements known as Basel III.
Today's message was unchanged, with Chair Powell reiterating that while the Fed doesn't need to see inflation drop all the way to 2% before cutting rates, officials do need to see more good data to feel fully confident that inflation is moving lower in order to cut rates. Take a listen.
JEROME POWELL: We don't want to have a situation where it turns out that the six months of good inflation data we had last year that didn't turn out to be an accurate signal of where underlying inflation is.
JENNIFER SCHONBERGER: Democratic ranking member Maxine Waters focused on housing, saying it's the number one driver of inflation. In an interview following the hearing, Waters told me that she would like to see the Fed target inflation higher than 2% and would like to see the Fed lower rates as soon as the March policy meeting.
MAXINE WATERS: I'm absolutely convinced that these rates should be lowered, that people are paying a disproportionate amount of their income for things that are necessities like food. And so we've got to bring those rates down.