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MNI BRIEF: Powell-Biggest Inflation Source Will Last Some Time

Federal Reserve Chairman Jerome Powell said Wednesday the biggest portion of inflation, core services ex-housing, will take a long time to come down, which will likely require policymakers to keep monetary policy at restrictive levels to come down.

"The third piece which is something like 55% of the index PCE and core inflation index is non-housing related core services," Powell said. "That part of it, which is the biggest part, is likely to take a substantial period to get down."

Powell said the latest SEP fully reflects the weaker than expected CPI data released Tuesday.

"The strong view on the committee is we'd need to stay (at the peak rate) until we're really confident that inflation is coming down in a sustained way and we think that will be some time," he added.


MNI NY Bureau | roy.beierlein@marketnews.com | 2126696442
MNI NY Bureau | roy.beierlein@marketnews.com | 2126696442

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