Powell: Fed to keep rates higher for longer to cut inflation

WASHINGTON (AP) — Fed Chair Jerome Powell says the Federal Reserve will push rates higher than previously expected and keep them there longer to fight a stubborn bout of inflation. In a speech to the Brookings Institution on Wednesday (Nov. 30, 2022), Powell also signaled that the Fed may increase its key interest rate by a smaller increment at its December meeting, only a half-point after four straight three-quarter point hikes. But Powell also stressed that the smaller size shouldn’t be seen as a sign the Fed will let up on its inflation fight anytime soon. Financial markets rallied in response to Powell’s suggestion that rate increases will slow.