Jerome H. Powell, the Federal Reserve chair, made it clear that his central bank wants to see further healing in the American economy before officials will consider pulling back their support by slowing government-backed bond purchases and lifting interest rates, the New York Times reported. Powell spoke at a news conference after the Fed announced that it would leave rates near zero and continue buying bonds at a steady clip, as expected. He painted a picture of an economy bouncing back — helped by vaccines, government spending and the central bank’s own efforts. The Fed’s post-meeting statement also portrayed a sunnier image of the American economy, which is climbing back from a sudden and severe recession caused by state and local lockdowns meant to contain the coronavirus. Yet Fed officials signaled that they were looking for more progress toward their goals of full employment and stable inflation before reconsidering their cheap-money stance. Officials made it clear that they see a recent increase in inflation, which is expected to intensify in the months to come, as likely to be short-lived rather than worrying. Powell was careful to avoid sounding as though he and his colleagues knew precisely what the future held. He pointed out, repeatedly, that reopening America’s giant economy from pandemic-era shutdowns was an uncharted project. For now, things are looking up. After reaching a low point a year ago, employment is rebounding, consumers are spending and the outlook is increasingly optimistic as vaccines become widespread. Data that will be released on Thursday is expected to show gradual healing in the first three months of the year, which economists think will give way to rapid gains in the second quarter.
