Powell says economy is adjusting to demands of a 'new reality'

[WASHINGTON] Federal Reserve Chair Jerome Powell said the US economy is experiencing "fundamental shifts" as people and businesses pivot to "meet the demands of a new reality."

Mr Powell made the remarks on Friday in a brief opening statement to a Fed Listens event. He didn't comment on monetary policy or the economic outlook in his prepared text.

"While uncertainty often results in immobility for businesses, it can also spell opportunity, and the creativity and adaptability on display over the past 18 months have been among the few bright spots," Mr Powell said.

"I have been amazed and inspired by the flexibility and ingenuity, particularly that of small businesses."

Fed Listens kicked off in 2019 as part of Mr Powell's review of the central bank's longer-run strategy, with more than a dozen events held at regional Fed banks around the country. US central bankers engaged a range of groups and people including union members, small business owners, and representatives of diverse communities.

Conclusions of the strategy review were announced in August 2020 with the Fed adopting a new framework for monetary policy that shifted policy to an average inflation target, without a defined time period, and a decision to no longer pre-judge the level of full employment.

The Fed announced in June that it would relaunch Fed Listens to gather on-the-ground information about the recovery.

BLOOMBERG