Federal Reserve Chair Jerome Powell delivered a sobering message to lawmakers on the U.S. House Financial Services Committee, indicating that any declaration of a “soft landing” for the economy would not come from the Fed.

During testimony before the committee, Powell navigated questions about the upcoming presidential election and steered clear of declaring victory over achieving the sought-after soft landing – characterised by low inflation and low unemployment.

Representative Al Green, a Texas Democrat, queried Powell about the possibility of an official announcement regarding a soft landing, especially in a political climate where competing claims about the economy’s health persist.

Powell’s response underscored the Fed’s cautious stance.

“We are just going to keep our heads down and do our jobs and try to deliver what the public is expecting from us. We wouldn’t be declaring victory like that.”

This exchange shed light on Powell’s pivotal role in the upcoming presidential race, with both President Joe Biden and former President Donald Trump having appointed him as Fed chair.

The outcome of the election may hinge, in part, on Powell’s decisions regarding monetary policy.

Amidst a climate of political uncertainty, Powell aims to remain neutral and avoid entanglement in partisan disputes.

Regardless of the election outcome, Powell emphasised that the U.S. economy is on a positive trajectory, aligning with the conditions indicative of a soft landing.

Despite indicators suggesting the possibility of a soft landing, Powell refrained from celebrating prematurely.

“That’s the economy that we’re trying to achieve. We’re on a good path so far to be able to get there,” he said.

“But I don’t want to put the label on it. Other people can do that.”