MNI BRIEF: Powell: Price Expectations Need To Stay Anchored

Keeping firms' and households' inflation expectations anchored at 2% is the top priority for the Federal Reserve, and the Fed will keep tightening monetary policy until inflation is under control, Chair Jerome Powell said Thursday.

"The longer that inflation remains well above targets, the greater the concern that the public will start to just naturally incorporate higher inflation into its economic decision making. Our job is to make sure that doesn't happen. And we're committed to doing that job," he told a Cato Institute conference in Washington. "We need to act now forthrightly, strongly as we have been doing and we need to keep at it until the job is done."

The dollar and Treasury yields have risen steadily in recent weeks on investors expectations that the Fed will continue lifting interest rates into next year. The FOMC is expected to raise rates by another 75bps or 50bps later this month. (See: MNI INTERVIEW: Fed Likely To Hike Another 75BPs In Sept-Haslag)