Mr Powell believes overnight that the economy is still a long way from achieving the goal of maximum employment and average inflation of 2 per cent. At the same time, optimistic economic forecasts push up long-term borrowing costsThat could complicate the Fed's efforts to keep interest rates low to support the economic recovery.

Powell made the remarks at his last public event before the Fed's next policy meeting from March 16 to 17. He said,The Fed will keep interest rates ultra-low until employment and inflation targets are met and will continue to buy large amounts of assets until "further substantial progress" is made.He said he expected it would take "some time" to meet the conditions for considering a rate hike, but declined to provide more specific information on the expected time frame.

Asked if the labor market is likely to meet the Fed's job maximization goal this year, Powell said, "No, I think it's highly unlikely. But he is not sure whether the economy will improve enough this year for the Fed to start reducing its bond purchases. "so far, I can't estimate the exact time," Powell said. He was referring to the criteria the Fed wants to meet before scaling back its asset purchases. After his speech, the stock market fell and government bond yields rose.

The tone of Powell's speech is still dovish, indicating two basic attitudes: the first is that the economy is recovering and the second is that the job market will not recover soon. Zhou Hao, senior emerging markets economist at Commerzbank, says that optimists see the former and pessimists see the latter. On the other hand, the Fed does not seem to believe that current bond yields deviate from economic fundamentals, which means bond yields will continue to rise moderately. On the other hand, even if Powell expresses an extremely dovish view, Treasury yields may fall slightly, but soon more bond sellers will come out to push yields higher-market expectations have changed, unless there are new variables. otherwise, the big trend is hard to change. It believes that now is far from the time for the Fed to save the stock market, and unless there is an inexplicable slump, the Fed will wait for the market to adjust itself.

Asked about the recent surge in bond yields, Mr Powell said: "this is a noteworthy thing that has caught my attention". Investors expect inflation and economic growth to accelerate this year. Yields on 10-year Treasuries, which affect long-term borrowing costs for consumers and businesses, have risen sharply in recent weeks. After Mr Powell's comments, Treasury yields rose further to 1.545 per cent, the highest level since before the outbreak, up from 1.462 per cent earlier on Thursday and 0.92 per cent at the start of the year.

The average interest rate on 30-year fixed-rate mortgages this week rose above 3 per cent for the first time since July last year, a trend that has begun to put pressure on applications for home purchases or refinancing, Freddie Mac said on Thursday. At this month's meeting, Fed officials will release their first forecasts for interest rates and the economy since December.

"I will be worried about the disorderly state of the market and the continued tightening of the financial environment, which will threaten the achievement of our goals," Powell said overnight. But he added that the Fed was focusing on "broad financial conditions" rather than a single indicator. "if things do change significantly, the Fed's rate-setting committee will be prepared to use the tools at its disposal to advance its goals," he said. "

Progress on vaccines, coupled with trillions of dollars in fiscal stimulus, has led to market forecasts that economic activity will rebound faster than expected last year. Many market participants also expect a surge in consumption to push inflation above the Fed's 2 per cent target once the economy fully opens up, a situation that has led to tighter monetary policy in the past. Powell said he is hopeful that the job market will improve significantly in the coming months as the U. S. economy begins to reopen.