Federal Reserve Chairman Powell said on Tuesday that the Federal Reserve will not pre-emptively raise interest rates and will not raise interest rates because they feel that the employment rate is too high.

Powell testified Tuesday afternoon on the “Federal Reserve's response to the coronavirus pandemic” on the US House Coronavirus Crisis Special Committee.

Powell said that the best way for the Federal Reserve to reduce inequality is to focus on employment and take countermeasures against the unemployment rate not meeting standards. Labor supply and employment conditions are expected to be good this year.

On the issue of inflation, which the market is generally concerned about, Powell said 5% inflation is unacceptable. He said that inflation was largely due to the reopening of the economy, which exceeded previous estimates.

Powell reiterated that the Federal Reserve is prepared to use tools when necessary to guide inflation back to 2%. The factors that influence inflation are expected to subside over time.