Federal Reserve Chair Jerome H. Powell and Kevin Schreiber, president and CEO of the York County Economic Alliance, walk down the street during a visit Oct. 2 to York, Pa. The economy continues to dash expectations for growth, hiring and consumer spending, complicating the Federal Reserve’s fight to tame inflation and get the job market into better balance.
Geopolitical tensions are also running high, with unknown risks for the world economy. Last year, Russia’s invasion of Ukraine roiled international energy markets and sent inflation soaring. And, now, turmoil in the Middle East adds even more instability. Powell said that he found this month’s attack on Israel by Hamas “horrifying, as is the prospect for more loss of innocent lives.”
“Additional evidence of persistently above-trend growth, or that tightness in the labor market is no longer easing, could put further progress on inflation at risk and could warrant further tightening of monetary policy,” Powell said.Much depends on how the economy evolves. But already, it’s clear that the recession that was so widely expected just one year ago isn’t materializing. Retail sales for September jumped 0.7 percent from the month before, far surpassing expectations.