Federal Reserve Chair Signals Possible Pause in Rate Hikes Amid Inflation Concerns

Federal Reserve Chair Jerome Powell hinted that the central bank will likely pause its benchmark interest rate hike when it meets in June, after raising it 10 times in the past 14 months to fight high inflation. Powell said the rate is now high enough to restrain borrowing, spending and economic growth, and that the risks of doing too much versus too little are becoming more balanced. He also noted that turmoil in the banking sector will likely cause banks to reduce the pace of lending, which could weaken the economy. However, some Fed officials believe the bank failures might have little impact on lending.