Higher Interest Rates are Here to Stay: U.S. Fed Head

Some not-so-great news for borrowers hoping for an interest rate break: the cost of borrowing is set to stay elevated for the foreseeable future, according to the head of US monetary policy.made at an economic symposium in Jackson Hole, Wyoming, Jerome Powell — Chair of the U.S Federal Reserve — said rates will remain high as long as inflation is a contender.

Powell warns this will lead to some “unfortunate costs” of reducing inflation, such as a softer labour market, and economic pain for households and businesses. However, he adds, while the American economy is clearly slowing from its strong pandemic rebound in 2021, he believes it continues to show strong underlying momentum, supported by a robust labour economy.

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