On Wednesday, Fed Chair Jay Powell will testify before Congress once again on the economy, inflation, and monetary policy. He is likely to say that the inflation we’ve seen lately is mostly transient, but that the Fed will reserve the option to tighten gradually and slightly as conditions warrant.
Money markets will approve, and the Reappoint Powell lobby will have another talking point. Permit me to weigh in on the other side.
The Powell forces have leaked to various outlets that his reappointment is now certain, hoping to create a bandwagon effect. (If all the leaks to Bloomberg of sure things proved accurate, Rahm Emanuel would now be ambassador to six countries.)
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