Inflation lowering in US, still long way to go: Fed chair

By Ovunc Kutlu

ISTANBUL (AA) - Inflation has been declining in the US but it still “has a long way to go,” Federal Reserve Chair Jerome Powell said Tuesday.

"The disinflationary process, the process of getting inflation down, has begun,” Powell said at an event at the Economic Club of Washington, D.C. “These are the very early stages of disinflation,"

"We don't think this process will be smooth, it is probably going to be bumpy," he said, adding Fed officials think bringing inflation down will be "a process that takes a significant period of time."

The US central bank raised interest rates by a total of 425 points in seven rate hikes last year to fight record inflation which jumped to a 40-year high in 2022.

The Fed raised its benchmark interest rate last Wednesday by 25 basis points -- less than December's hike of 50 basis points.

"We expect 2023 to be a year of significant declines in inflation," he said, adding that it will also take next year to get down inflation close to the Fed's target of 2%.

Annual consumer inflation in the US came in at 6.5% in December, easing from 7.1% in November, while producer inflation dropped to 6.2% in December from November’s 7.3%.