Sen. Elizabeth Warren, D-Mass., said Sunday that she is “very concerned” that measures taken by the Federal Reserve to curb inflation will put “millions” of Americans out of work.
During an appearance on CNN’s “State of the Union,” Warren said she is concerned that the Fed’s continued rate hikes could “tip” the country into a recession.
“I̵[ads1]7;m very concerned about this, because the causes of the inflation, things like the fact that COVID is still shutting down parts of the economy around the world, that we still have breaks in the supply chain, that we still have a war going on in Ukraine that is driving up costs for energy and that we still have these giant companies engaged in price gouging,” she said.
“There’s nothing in raising interest rates, nothing in Jerome Powell’s toolbox that directly addresses these, and he’s admitted as much in congressional hearings when I’ve asked him about it,” she continued. “You know what’s worse than high prices and a strong economy? It’s high prices and millions of people out of work. I’m very worried that the Fed is going to tip this economy into recession.”
FED’s POWELL COMMITS TO FIGHTING INFLATION ‘DEMANDS’ BUT WARNS OF ECONOMIC PAIN AHEAD
Fed Chairman Jerome Powell delivered a strong message on Friday about the state of the US economy at the annual central bank meeting in Wyoming: Inflation remains painfully high and cooling will require forceful action that could soon bring “pain” to households and businesses across the country. .
In his much-anticipated speech at the Kansas Federal Reserve’s Jackson Hole symposium, Powell repeated a pledge to “vigorously” combat inflation still running near its hottest pace in 40 years and wrestle it closer to the Fed’s 2% target.
“While higher interest rates, lower growth and softer labor market conditions will bring down inflation, they will also cause some pain for households and businesses,” he said. “These are the unfortunate costs of reducing inflation. But a failure to restore price stability will mean far greater pain.”
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Even with four consecutive rate hikes, including two back-to-back increases of 75 basis points, Powell stressed that the Fed is not in a place to “stop or pause” — an unwelcome sign for investors who were anticipating a rate cut next year.
Fox News’ Megan Henney contributed to this report.