Chairman of the Federal Reserve： There will be no ＂preemptive＂ interest rate hike.

　　Xinhua News Agency, Washington, June 22 (Reporter Xu Yuan Gao Pan) US Federal Reserve Chairman Powell said on the 22nd that the inflationary pressure facing the US economy is higher than expected earlier, but the factors leading to the inflation rise are temporary, and the Fed will not "pre-empt" the interest rate hike.

　　On the same day, Powell said at the congressional hearing that the inflation index in the United States has increased obviously recently, and the reasons include the low cardinal utility at the beginning of the COVID-19 epidemic, rising oil prices, consumer spending rebounding with the economic restart and supply bottlenecks. As these "temporary" factors diminish, the inflation rate is expected to fall back to the long-term target of 2% set by the Federal Reserve.

　　Powell said that the probability of hyperinflation in the US economy is "very low", and the Fed will not "pre-empt" interest rate hikes for fear of high inflation. But he stressed that this round of inflation may be more lasting than expected. If inflationary pressure continues to increase, the Fed will use policy tools when necessary to guide inflation back to the target level.

　　He also said that the decline in vaccination rate and the spread of new mutant strains will become risk factors for future economic growth in the United States.

　　According to data from the US Department of Labor, after seasonal adjustment, the US consumer price index increased by 5% year-on-year in May, the largest year-on-year increase since August 2008.

　　On the 16th of this month, the Federal Reserve announced that it would keep the target range of the federal funds interest rate between zero and 0.25%, and maintain the asset purchase scale of not less than $120 billion per month. At the same time, the Federal Reserve sharply raised its inflation forecast this year to 3.4%.