Federal Reserve Chairman Jerome Powell said the U.S. central bank was on the lookout for threats to financial stability amid turmoil in markets as it continued to make progress in its pursuit of full employment and stable prices.
“We will remain alert to any developing risks to financial stability,” he said Tuesday in the text of remarks in Washington at his ceremonial swearing-in. “We are in the process of gradually normalizing both interest rate policy and our balance sheet with a view to extending the recovery and sustaining the pursuit,” of its twin statutory goals.
The comments were his first in public since financial markets last week suffered their most severe bout of volatility in years on concern that rising wages might spur inflation and prod the Fed to raise interest rates faster. Its next policy meeting is on March 20-21 and a rate hike is widely anticipated by investors, according to pricing in federal funds futures.
“We have made great progress in moving much closer to those statutory objectives,” he said, referring to the Fed’s dual goals. “In addition, the financial system is incomparably stronger and safer, with much higher capital and liquidity, better risk management, and other improvements.”
Powell, 65, formally took the oath of office on Feb. 5 to replace Janet Yellen as chair. The ceremony on Tuesday was attended by family, friends and other Fed officials.
Nominated by President Donald Trump in November and confirmed by the Senate last month with broad bipartisan support, Powell stressed the Fed would “preserve the essential gains in financial regulation while seeking to ensure that our policies are as efficient as possible.”
He is scheduled to deliver his first semi-annual testimony to Congress on Feb. 28 and will hold his first press conference as chairman after the Fed’s policy meeting in March.