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Fed's Powell says monetary policy is 'modestly restrictive'

BY Reuters | ECONOMIC | 06/18/25 03:11 PM EDT

By Michael S. Derby

June 18 (Reuters) - Federal Reserve Chairman Jerome Powell said on Wednesday that monetary policy still needs to impose some restraint on the economy given where inflation stands.

The current level of interest rates--the Fed's target range rests between 4.25% and 4.5%--is "not very high," Powell said. "I would say policy is modestly or moderately, probably modestly now restrictive."

He added, "If you look at the economy, it's not performing as though it were performing" under "very restrictive monetary policy." (Reporting by Michael S. Derby; Editing by Leslie Adler)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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