Mr Powell said: “2.7 million people hired in the first half of the year, it doesn’t make sense that the economy would be in recession.”
He also said he hasn’t seen the second-quarter gross domestic product report set for release Thursday morning. But he cautioned the report will likely not be the last word on second-quarter growth.
“Generally the GDP numbers do have a tendency to be revised pretty significantly,” he said. “You tend to take first GDP reports with a grain of salt.”
The Federal Reserve accelerated its efforts to reverse its easy-money policies by approving another unusually hefty interest rate hike and warning that more hikes were likely to follow to battle inflation, which is at a 40-year high.
Officials decided on Wednesday to raise their benchmark federal-funds rate by 0.75 percentage points, bringing it to a range of 2.25% to 2.5%. The 12-member rate-setting committee unanimously supported the rate hike.
Officials noted signs of slower economic activity since their last meeting in a policy statement issued following the completion of their two-day meeting. “Recent indicators of spending and production have softened. Nonetheless, job gains have been robust in recent months,” the statement said.
“We want to hear what Fed Chairman Jerome Powell is thinking about the inflation outlook and what he is thinking about the growth outlook. But we have to be careful. We’ve learned in the last couple of months that we can’t read too much into any broad guidance,” said Seema Shah, chief global strategist at Principal Global Investors.
“It doesn’t mean that a recession isn’t going to happen within the next couple of quarters,” Ms. Shah said. “This is your ultimate bear-market rally”.
Also Read | Why is the US Fed Reserve hiking interest rates?
Investors have grown highly worried that the Fed could push the US into a recession through tighter policy. Second-quarter gross-domestic product data on Thursday will
provide information into the economy’s recent performance.