Powell: "Stagflation" is a term from the 1970s and is not the issue we face today.

MaticHoleFiller · 2026-03-27T11:33:09+00:00

Federal Reserve Chairman Powell stated that despite current economic challenges, the situation is far from the "stagflation" of the 1970s, with both inflation and unemployment rates remaining stable. Therefore, the Federal Reserve has decided to keep interest rates unchanged and expects only one rate cut this year.

MaticHoleFiller

2026-03-27 11:33:09

Abstract generation in progress

Topic: Federal Reserve Announces No Change in Interest Rates; Financial Institutions Expect Only One Rate Cut This Year

Federal Reserve Chairman Jerome Powell stated on Wednesday that even with the Iran war causing energy prices to surge, the current economic situation in the U.S. is far from the “stagflation” of the 1970s, with current inflation only one percentage point above the target and the unemployment rate remaining low.

Powell said during a press conference following the Fed’s decision to keep policy rates steady: “I’ll leave the term ‘stagflation’ for situations that are much more serious than what we have now. Our current situation is not that.”

Powell added, “What we are facing is some tension between the targets, and we are trying to work through that. This is a very difficult situation, but it is completely different from what was faced in the 1970s. I reserve the term ‘stagflation’ for that time. Perhaps that’s just my view.”

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Editor: Li Tong

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