Ryssdal: Does that mean you guys are ready to go back to the zero lower bound if you have to?
Powell: If you have to, you have to. Yes. It's not impossible. Monetary policy's about forecasts. You have to have a forecast of where things are gonna go and you try to set monetary policy for what you see as the likely path of the economy.
Ryssdal: "Gradually" got a lot of attention in Chair Yellen's press conference the other day. She made great efforts to say, "It's not gonna be a mechanical thing." Without using her favorite phrase, which is, "It's gonna depend on the data," what are you gonna be looking at to think and to know when it's okay to start ratcheting things up again?
Powell: Well we do look at a wide range of things. For me, at the top of the list will be continued progress in the labor market and with it continued progress on inflation. Inflation is in below our target. As I mentioned, the labor market has strengthened quite a bit, but I wanna see continued strong job growth. We've had three years of very strong job growth. I want to see that continue. And as the labor market tightens, I'd like to see wages increasing, and as the economy tightens, we need to see inflation coming up. Underlying inflation, if you look through the changes in gas prices and import prices is probably running at around one and a half percent. Our goal is two percent, so we'd like to see underlying inflation come up to two percent.