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Sen. Elizabeth Warren fired back at Federal Reserve Chairman Jerome Powell Sunday for suggesting an increase in interest rates, saying that “the Fed is going to tip this economy into recession.”
Warren stated that Powell’s plan doesn’t directly address current causes of inflation, using the COVID-19 pandemic, supply chain issues, and the war in Ukraine as examples, as well as “giant corporations that are engaging in price gouging.”
“There is nothing in raising the interest rates, nothing in Jerome Powell’s tool bag, that deals directly with those, and he has admitted as much in congressional hearings when I’ve asked him about it,” the senator told CNN’s Dana Bash on “State of the Union.” “I’m very worried that the Fed is going to tip this economy into recession.”
This follows Powell’s comment Friday that the fight against inflation through “higher interest rates, slower growth, and softer labor market conditions” will bring “some pain” for U.S. households. Warren slammed Powell’s phrasing of the issue.
“What he calls ‘some pain’ means putting people out of work, shutting down small businesses, because the interest rates go up,” Warren said.
