In a speech Friday, Powell said these measures could cause “some pain” to households and businesses.
“What he calls ‘some pain’ means putting people out of work, shutting down small businesses, because the cost of money goes up, because the interest rates go up,” Warren said in her response.
Powell’s plan does not address what Warren labeled as the root causes of inflation, including the ongoing impacts of Covid, supply chain issues and the war in Ukraine.
“There is nothing in raising the interest rates, nothing in Jerome Powell’s tool bag, that deals directly with those. And he has admitted as much in Congressional hearings,” the Massachusetts Democrat said.
Powell’s brief speech at the Fed’s annual conference Friday was highly anticipated; he suggested at the same gathering last year that inflation would be temporary.
His reappointment split progressives at the beginning of President Joe Biden’s administration.