US Federal Reserve chief Jerome Powell warned Tuesday that slashing interest rates too quickly could allow inflation to remain elevated, but stressed that the central bank faces dual challenges moving forward.

“There is no risk-free path,” he told a Rhode Island event. “If we ease too aggressively, we could leave the inflation job unfinished and need to reverse course later to fully restore two-percent inflation.”

“If we maintain restrictive policy too long, the labor market could soften unnecessarily,” the US central bank chair added.

The Fed made its first rate cut of the year last week, lowering the benchmark lending rate by 25 basis points in a widely anticipated move.

The reduction came while the independent central bank faced intensifying pressure from Donald Trump. The president

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