Jerome H Powell: Building on the gains from the long expansion

Speech by Mr Jerome H Powell, Chair of the Board of Governors of the Federal Reserve System, at the Annual Meeting of the Greater Providence Chamber of Commerce, Providence, Rhode Island, 25 November 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Over the past year, my colleagues and I on the Federal Open Market Committee (FOMC) have been conducting a first-ever public review of how we make monetary policy. As part of that review, we held Fed Listens events around the country where representatives from a wide range of groups have been telling us how the economy is working for them and the people they represent and how the Federal Reserve might better promote the goals Congress has set for us: maximum employment and price stability. We have heard two messages loud and clear. First, as this expansion continues into its 11th year-the longest in U.S. history-economic conditions are generally good. Second, the benefits of the long expansion are only now reaching many communities, and there is plenty of room to build on the impressive gains achieved so far.

These themes show through in many ways in official statistics. For example, more than a decade of steady advances has pushed the jobless rate near a 50-year low, where it has remained for well over a year. But the wealth of middle-income families-savings, home equity, and other assets-has only recently surpassed levels seen before the Great Recession, and the wealth of people with lower incomes, while growing, has yet to fully recover.