(Bloomberg) -- Federal Reserve Chairman Jerome Powell reiterated to Democrats on the House Ways and Means Committee during a meeting Wednesday that the U.S. central bank is pursuing a patient rate-hike path.
While the Fed is sometimes criticized for not raising rates more aggressively, Powell said inflation has been low and so policy makers are moving cautiously, according to a congressional aide who attended the meeting and didn’t want to be named, since it was not public. The gathering took place on Capitol Hill and lasted about an hour, starting with an economic overview and moving to questions.
Asked if he would like additional policy tools, Powell said the Fed is comfortable with those it already has. That said, he emphasized -- as he often does -- that he and his colleagues have only blunt monetary-policy levers, and fiscal policy is needed to tackle widening inequality and other distributional issues.
“The chairman was forthright as we discussed trade, wages, and unemployment,” Representative Bill Pascrell of New Jersey said in an emailed statement. “While the economy is strong, it is my view that we in Congress need to do more to increase the labor force participation rate.”
The group discussed that the U.S. has low female labor force participation relative to other advanced economies and also has low non-college-educated male participation. Powell pointed out that minority unemployment remains higher than white joblessness. He avoided making political statements or policy recommendations, the congressional aide said.
Powell, appointed by Republican President Donald Trump, regularly meets with lawmakers including Democrats. In April, he met with Republican Bill Huizenga, Democrat Lacy Clay, Democrat Emanuel Cleaver, and Democrat Richard Neal, ranking member on the House Ways and Means Committee, according to his most recent publicly available calendar.
While it isn’t routine for a Fed chair to gather with large groups of legislators outside of their regularly-scheduled Congressional testimony appearances, Powell has done so in the past. He spoke on a panel at the 2018 GOP Committee Member Retreat in Maryland on Jan. 28, and was sworn in to office on Feb. 5, replacing Janet Yellen.
This week’s event was predominately a “getting-to-know-you” meeting, according to another congressional aide, also speaking on background because the discussion was off-record.
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