Fed’s Powell says credit tightening eases pressure to raise rates

The president of the Federal Reserve pointed out that the official interest rate may not have to rise as much to reach its objectives 

Federal Reserve Chairman Jerome Powell said on Friday that the fallout from recent banking sector woes is taking some of the pressure off the US central bank to raise rates. Powell noted that the tightening of credit conditions means that "the Federal Reserve's key interest rate may not have to rise as much as it otherwise would have to reach its targets." He also noted that after a year of aggressive rate hikes, the Fed "can afford to look at the data and the evolving outlook to make careful assessments." Powell said they "face uncertainty about the lagged effects of their tightening so far, and about the extent of credit tightening from the recent banking stresses." In summary, Powell said that monetary policy is being adjusted to reflect balanced risks and that no decision has been made on the extent to which further policy tightening will be appropriate.