Powell: Stimulus Unlikely to Lead to Surge in Inflation

The recently passed $1.9 trillion relief package is not expected to result in an undesirable rise in inflation rates in the United States, the Chairman of the U.S. Federal Reserve, Jerome Powell, said on Monday.

Powell also said that the central bank is ready to deal with a surge in inflation if necessary using a variety of tools in his remarks before members of the House of Representatives.

“Our best view is that the effect on inflation will be neither particularly large or persistent.”

“While the economic fallout has been real and widespread, the worst was avoided by swift and vigorous action.”

The Fed Chair is testifying before the House Financial Services Committee, as part of Congressional Oversight of the Treasury Department’s and Federal Reserve’s Pandemic Response.