Powell highlights Fed’s commitment to ‘inclusive’ recovery

By CHRISTOPHER RUGABER
AP Economics Writer

WASHINGTON (AP) — Federal Reserve Chair Jerome Powell said inequality can prevent the U.S. economy from reaching its potential. He underscored the Fed’s commitment to reducing unemployment as broadly as possible, including among disadvantaged groups. Powell’s comments illustrate one reason why the Fed has been hesitant to reverse its low-interest rate policies even as inflation has spiked to three-decade highs this year. Before the pandemic, the Fed kept its benchmark short-term interest rate pegged at nearly zero, and unemployment eventually fell to a 50-year low of 3.5%. The benefits of the strong pre-pandemic economy were widespread.