Markets Reverse Sharply on Feds Powell Statements, What Does it all Mean?

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    Helmholtz Watson


    We will not achieve a sustained strong labor without price stability
    We will likely need a restrictive stance of policy for some time
    Price stability is the bedrock of our economy
    US economy has slowed significantly from last year
    Recent data indicates modest growth this quarter
    Activity in housing has weakened
    Jobs market is still extremely tight
    Inflation is still well-above our goal
    Financial conditions have tightened significantly and we are seeing the effects but it will take time for full effects to be realized
    At some point, it will become appropriate to slow the pace of rate increases
    There is ‘significantly uncertainty’
    Incoming data suggests the ultimate level of rates will be higher than previously anticipated
    We will stay the course until the job is done

    Helmholtz Watson

    Powell Q&A: The ultimate top in rates is ‘very uncertain’

    We’ve moved 3.75 percentage points since March
    We’re saying we will hike to a level that’s sufficiently restrictive to tame inflation over time
    We think there’s some ground to cover, and cover it we will
    The ultimate top is ‘very uncertain’ but CPI and labor data suggests to me it will be higher than previously throught
    The time to slow the pace of hikes could be at the next meeting or the one after that. It will be discussed at the next meeting
    I’m pleased we’ve moved as fast as we have.
    I don’t think we’ve overtightened
    We had a discussion at this meeting about slowing rate hikes


    Thirty minutes in financial markets is a long time. Markets were relieved after the Federal Reserve again raised rates by 75 bp at their November meet
    [See the full post at: Markets Reverse Sharply on Feds Powell Statements, What Does it all Mean?]


    Central Bank Watch Thursday, Nov. 10 #Fed

    02:00 Fed Waller Speaks
    09:00 FOMC Member Harker Speaks
    09:35 Fed Logan Speaks
    11:35 Fed Daly Speaks
    12:30 FOMC Member Mester Speaks
    13:30 FOMC Member George Speaks
    18:35 FOMC Member Williams Speaks


    Fed’s Kashkari “This inflation is from demand, not constrained supply” (Huh? sounds like a party line – what is his supply concept?)
    Inflation not wage-driven
    There is a lot of tightening in the pipeline
    Fed’s job is to keep inflation in check
    US economy is sending wildly mixed signals
    We are united in commitment to getting inflation to 2%

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