Federal Reserve Chair Jerome Powell said Thursday that the central bank may have to tighten its oversight of the American financial system in the wake of the failure of three large U.S. banks this spring.Related video above: Analyst discusses what lies ahead in the market as fed pauses rate hikesPowell said in prepared remarks delivered at a banking conference in Madrid that tougher regulations put in place after the 2007-2008 financial crisis have made large multinational banks much more resilient to widespread loan defaults, such as the bursting of the housing bubble that led to that crisis.But the collapse of Silicon Valley Bank, Signature Bank and First Republic Bank exposed different vulnerabilities that the Fed will likely address through new proposals, Powell said.He did not provide details, but other Fed officials have said banks should be required to hold more capital in reserve to guard against loan losses.Such proposals are likely to face resistance from the banking industry and some congressional Republicans, who argue that the Fed had the necessary tools to prevent the bank collapses but failed to use them.One reason regulators missed the threats to the three banks was "the natural human tendency to fight the last war," Powell said.The 2008 financial crisis occurred because of widespread defaults after the housing bubble burst. But Silicon Valley Bank failed for different reasons: A rapid increase in interest rates sharply lowered the value of its bond holdings, because they paid out lower interest rates than newer bonds."These events suggest a need to strengthen our supervision and regulation of institutions of the size of SVB," Powell said. "I look forward to evaluating proposals for such changes and implementing them where appropriate."In a question and answer session, he indicated that the rules needed to be updated to account for how quickly a bank run could happen."A bank run used to be people standing in line at an ATM," the Fed chief said. "That's very different from what we saw at Silicon Valley Bank," with depositors using smartphones to move money instantly.Fed supervisors had spotted bank vulnerabilities, including exposure to rising rates, but were working within a system that moved too slowly to head off trouble, Powell said."The supervisors were on the right issues, but they were operating under a standard playbook where you escalate things fairly carefully, fairly slowly," he said.An ongoing review of Fed supervision would "try to find ways to be more agile and, where appropriate, more forceful," Powell said.Banks with $100 billion to $250 billion in assets — which included all three failed banks — were freed from some requirements in 2018 under legislation passed by Congress and rules issued by the Fed.Last week, Powell faced significant pushback from Republicans during House and Senate hearings over the potential for tighter rules. Michael Barr, the Fed's top regulator, has said the central bank might require larger banks to hold more capital in reserve.Yet GOP members of Congress charge that such requirements would limit banks' ability to lend and slow the economy.Powell said during those hearings that a proposal might be issued next month. But he repeated Thursday that any new rules would require a public comment process and would be phased in over time, meaning they might not come into effect for several years."The bank runs and failures in 2023 ... were painful reminders that we cannot predict all of the stresses that will inevitably come with time and chance," Powell said. "We therefore must not grow complacent about the financial system's resilience."___AP Business Writer David McHugh contributed from Frankfurt, Germany.

Policymakers at the Federal Reserve signaled last month that they were considering a pause in their 14-month-long regimen of hiking interest rates to cool the economy and bring down inflation.Related video above: Economy: Debt limit looms; inflation concernsBut the U.S. economy is like an engine that won’t quit — it just keeps on pumping out jobs. New data out Wednesday showed that job openings and hiring both rose in April, while unemployment sits near 53-year lows. With just two weeks left until the central bank’s next policy decision, it appears that more rate hikes could be coming after all.Investors — already contending with the fallout from the banking crisis, the lingering effects of debt ceiling turmoil and economic slowdowns in China and Europe — aren’t very happy about that prospect.What’s happeningThe number of available jobs in the United States rose unexpectedly in April after three months of declines.Job openings climbed to 10.1 million in April, according to data released Wednesday by the Bureau of Labor Statistics. Economists were expecting about 9.4 million, according to consensus estimates on Refinitiv. There are now 1.77 openings for every job seeker, the BLS data show. Hiring activity also grew and layoffs dropped in April.Job growth is healthy and that’s good for the economy. Business and consumer sentiment remain resilient and spending and investment are also proving to be relatively robust. But this could be another case of “good news is bad news” for the Federal Reserve. Fed Chair Jerome Powell has said that he wants to see more slack in the labor market. If there’s an imbalance between labor supply and demand, he says, wages will rise and add to upward pressure on prices.More data is expected before the Fed next decides on interest rates on June 14, including the closely-watched government jobs report Friday and the Consumer Price Index for May due June 13.Fed Governor Philip Jefferson said on Wednesday that a pause at the June meeting wouldn’t mean that hikes are finished but would instead give central bank officials more time to assess the state of the economy.“A decision to hold our policy rate constant at a coming meeting should not be interpreted to mean that we have reached the peak rate for this cycle,” said Jefferson in a speech. “Indeed, skipping a rate hike at a coming meeting would allow the committee to see more data before making decisions about the extent of additional policy firming.”Also complicating matters: The Fed’s favorite inflation gauge bounced higher in April. The Personal Consumption Expenditures price index rose 4.4% for the 12 months ended in April, up from a 4.2% increase seen in March, according to data released Friday by the Commerce Department.“It remains to be seen whether the Fed is prepared to pause or skip a rate hike at a forthcoming meeting,” said Bankrate senior economic analyst Mark Hamrick. “While the Fed is still talking like it is on the inflation righting warpath, the resilience and strength of the job market have been remarkable.” Markets are currently placing the probability of a quarter percentage point rate hike in June only at about 30%, according to CME FedWatch. That’s up from around 0% in mid-May. Prior to Jefferson’s speech, markets were pricing in a 70% chance. “After last month’s meeting, it seemed certain that the word change signaled that the Fed was on pause,” said Sam Stovall, chief investment strategist at CFRA research. “However, due to stronger-than-expected economic reports, stickier-than-anticipated inflation readings, and increasingly hawkish Fedspeak, we now see the postponing its pause and raising rates by ,” he said. The bottom lineUncertainty seems to be the name of the game right now. “Markets may wish for a Fed pivot, but we believe that hope is not a strategy,” said David Kotok, chairman and chief investment officer at Cumberland Advisors. “Of course,” he added, “that could change at any time.”Debt ceiling deal makes its way to the Senate The House of Representatives passed the deal to suspend the nation’s debt ceiling through Jan. 1, 2025, late on Wednesday night. The final tally for the vote was 314 to 117. The bill now needs to be passed by the Senate before it can be sent to President Joe Biden to be signed into law. It’s not yet clear when the Senate will vote, but Senate Minority Leader Mitch McConnell told reporters on Wednesday that he hopes the Senate will finish voting on the debt ceiling agreement on Thursday or Friday“Tonight, the House took a critical step forward to prevent a first-ever default and protect our country’s hard-earned and historic economic recovery,” Biden said in a statement moments after the House voted. “This budget agreement is a bipartisan compromise. Neither side got everything it wanted. That’s the responsibility of governing.”But while Biden celebrated the news, investors weren’t as excited. Stock futures inched up immediately after the bill passed through the House but quickly dropped down again. They were narrowly higher early on Thursday.That could be because of lingering concerns about its passage through the Senate, but also because other worries are likely to return center stage.Economic problems in China have been rattling US markets. Factory activity in China dropped to new lows for the second month in a row, fueling investor fears that the country’s post-Covid economic boom is ending. American CEOs, including JPMorgan (JPM) chief Jamie Dimon and Tesla (TSLA) head Elon Musk, have flocked to China this week to assess the risks to their investments in the country.Dimon for president? Jamie Dimon is arguably the most powerful man in corporate America. He may be eying political power, too. Normally, Dimon is quick to shoot down speculation that he could run for office. But in an interview with Bloomberg Television released on Wednesday, Dimon didn’t rule it out.Asked if he’s ever considered a public office position, Dimon said: “I love my country, and maybe one day I’ll serve my country in one capacity or another.”Dimon, 67, stressed that he’s focused on running JPMorgan, a role that has become even more complex amid the banking crisis and the ongoing debate over the debt ceiling, reports my colleague Matt Egan. “I love what I do,” Dimon told Bloomberg, adding he’s “quite happy” in his current job. He noted JPMorgan does a “great job helping Americans, for helping countries around the world.”In 2016, Dimon said he’d “love to be president” but added it’s “too hard and too late” for him to do that.