September 20, 2023 Federal Reserve meeting, Jerome Powell says more hikes ahead

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United Auto Workers members attend a rally in Detroit on September 15. Paul Sancya/AP

The Federal Reserve has a tough job making sense of America’s economic data and predicting the future on a good day. Add a United Auto Workers strike, oil prices nearing $100 a barrel, gas prices hitting $4 in 11 states and the possibility of a government shutdown … and that makes for a very tricky job for Fed economists.

“Forecasting is very difficult,” Federal Reserve Chair Jerome Powell conceded in a press conference Wednesday. “Forecasters are a humble lot, with much to be humble about.”

In particular, Powell said the wrenches thrown into the economy’s gears make forecasting even more difficult.

“Ultimately, though, there is so much uncertainty around these things,” he said.

UAW strike

Powell declined to comment on the politics of the strike. But he said among the many unknowns are the effect on America’s economic output, hiring and its impact on inflation.

“That’s going to depend on how broad it is and how long it’s sustained for, and it also depends how quickly they can make up for lost production,” Powell said. “So none of those things are known now. It’s very, very hard to know.”

Oil prices

On energy prices, Powell said “that is a significant thing” for consumers and the economy.

“Energy prices being up can affect spending,” he said. “A sustained period of higher energy prices can affect consumer expectations about inflation.”


On the threat of a government shutdown, Powell also declined to comment on the politics but said it’s hard to say in advance how it might affect the economy.

“It would depend on all kinds of factors I don’t know about now, but it’s certainly a reality that that’s a possibility,” Powell noted.


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