Federal Reserve Chairman Jerome Powell is expected to warn Congress that while the Federal Reserve continues to expect inflation will move down "significantly" over the next year, it "now appears that factors pushing inflation upward will linger well into next year." The new COVID-19 variant Omicron could have a negative impact on employment and inflation, Powell plans to tell Congress Tuesday, according to his prepared remarks. "The recent rise in COVID-19 cases and the emergence of the Omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation. Greater concerns about the virus could reduce people's willingness to work in person, which would slow progress in the labor market and intensify supply-chain disruptions," Powell will warn. He'll be appearing at a hearing before the Senate Committee on Banking, Housing and Urban Affairs to testify about the economic recovery from the pandemic. The World Health Organization flagged Omicron as a COVID variant of concern on Friday: it appears to spread quickly, and it's not yet known how effective existing vaccines are against it. According to Dr. Anthony Fauci, it'll be about two weeks before more is known about its transmissibility, severity and other characteristics. The Biden administration acted quickly to try slow the spread of the new variant in the U.S., imposing travel restrictions on eight countries in Southern Africa. Officials are also urging Americans to get vaccinated or booster shots. On Monday, President Biden sought to calm Americans, characterizing the variant as cause for concern, but not panic. While Powell will be acknowledging that the economy is continuing to strengthen and conditions in the labor market are still improving, he'll also be reminding senators that over the summer, the rapidly sp . . . read the full article here.