Powell defends Fed policies

Federal Reserve Chair Jerome Powell is defending the ultra-low interest rate policies he has pursued since the pandemic decimated the economy more than 18 months ago. He acknowledges, however, that inflation has stayed higher for longer than he expected. At a panel sponsored by the European Central Bank on Wednesday Powell said the Fed has avoided the mistake of underestimating the severity of pandemic’s economic impact. But criticism of the Fed’s policies has grown in recent months as inflation has jumped to 30-year highs. The economy’s main challenge has also shifted from weak demand as a result of widespread layoffs to supply shortages, which the Fed can do little about.