The Federal Reserve delivered its bluntest reckoning Wednesday of what it will take to finally tame painfully high inflation: Slower growth, higher unemployment and potentially a recession
Speaking at a news conference, Chair Jerome Powell acknowledged what many economists have been saying for months: That the Fed's goal of engineering a “soft landing” — in which it would manage to slow growth enough to curb inflation but not so much as to cause a recession — looks increasingly unlikely.
“We have got to get inflation behind us,” Powell said. “I wish there were a painless way to do that. There isn’t.” . Consumers and businesses then presumably borrow and spend less, cooling the economy and slowing inflation. Fed officials now foresee the economy expanding just 0.2% this year, sharply lower than their forecast of 1.7% growth just three months ago. And they envision sluggish growth below 2% from 2023 through 2025. Even with the steep rate hikes the Fed foresees, it still expects core inflation — which excludes volatile food and gas costs — to be 3.1% at the end of 2023, well above its 2% target.to households and businesses.
that he believed a soft landing for the economy was still possible, suggesting that his administration's recent energy and health care legislation would lower prices for pharmaceuticals and health care.outside analyses suggest it will do little to immediately bring down overall inflation
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