Federal Reserve Chairman Jerome Powell blamed the migrant crisis for the nation’s growing unemployment after cutting the benchmark interest rate by 0.5 percentage point for the first time since early days of Covid-19 on Wednesday.
“If you’re having millions of people come into the labor force, then — and you’re creating 100,000 jobs — you’re going to see unemployment go up,” Powell told reporters, answering a question about the nation’s current monthly job creation.
“So it really depends on what’s the trend underlying the volatility of people coming into the country.”
“We understand there’s been quite an influx across the borders, and that has actually been one of the things that’s allowed the unemployment to rise,” he said, according to the Wall Street Journal.
“And the other thing is just the slower hiring rate, which is something we also watch carefully. So it does depend on what’s happening on the supply side.”
“And the other thing is just the slower hiring rate, which is something we also watch carefully. So it does depend on what’s happening on the supply side.”
Powell’s comments come after the Fed accelerated its plan to cut interest rates — originally thought to be just 0.25 percentage point — over concerns about rising unemployment and slowing growth in recent months.
