Fed’s Powell says US close but not there yet on inflation
Federal Reserve Chair Jerome Powell says the US has made progress toward 2% inflation but isn’t quite there yet during a House Financial Services Committee hearing.
Bloomberg
- Banks in western states are experiencing stability due to a strong economy.
- Bank failures are at low levels, and the banking industry is continuing to consolidate.
- Community bankers are advocating for fewer regulations, while Federal Reserve officials advise a balance between consumer protection and economic growth.
Banks in Arizona and western states are benefitting from a generally solid economy with ongoing growth and steady employment and remain “safe and sound,” a top Federal Reserve official said in Phoenix.
She said banks are probably anticipating a bit less regulation coming from Washington.
“The national economy is in a good place,” said Mary C. Daly, president and CEO of the Federal Reserve Bank of San Francisco, at a conference geared to community bankers and hosted by the American Bankers Association. Businesses in Arizona and other Western states seem more optimistic than those in many other parts of the nation, she added.
Daly spends much of her time traveling around to meet with business representatives and others in her district, which encompasses nine states including Arizona. She spoke Feb. 18 at the conference, held at the JW Marriott’s Desert Ridge Resort & Spa.
Daly said Fed officials haven’t received any specific directives from the Trump Administration on how to do their jobs. The central bank has operated independently from the White House since 1913, working to coordinate policies that keep inflation low while promoting economic growth.
“All administrations want the same thing,” she said in an interview with the Arizona Republic, citing economic growth, steady employment and low inflation.
Daly, who also participates in setting the Fed’s interest-rate policies, said she hasn’t sensed unusually high concern from bankers or businesses over the Trump Administration’s tougher immigration stance and its potential impact on employment, nor on the imposition of tariffs, though some companies appear to be stockpiling inventory.
Fewer bank failures in recent years
Daly has visited Phoenix before, in October 2023, when she described steady progress in bringing down inflation, which back then was hovering around 3.7%.
That visit came in the aftermath of three large-bank failures in early 2023, including Silicon Valley Bank, which had a presence in Arizona. But Daly said banks in the current environment are in “really good shape.”
The banking industry continues to consolidate, though failures are at low levels.
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