TL; DR
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Hours of work go into reading the words of Fed Chairman Jerome Powell, reading his moods, and distilling it all into a “general atmosphere” that affects trillions of dollars in global investment.
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The market loved Jerome’s plans for the future – because markets like certainty – and for the past year we have been starved of it.
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The economy is not yet out of the woods, but this is a good sign.
Full story
Transcripts of Federal Reserve meetings are like horoscopes for financial brethren.
(Tell us we’re wrong – we dare you!)
Hours of work go into reading the words of Fed Chairman Jerome Powell, reading his moods, and distilling it all into a “general atmosphere” that affects trillions of dollars in global investment.
It’s weird.
And while we covered the Fed’s latest meeting yesterday, there’s still more to discuss!
Because this time it was different. This time, no crystal ball was needed to figure out J-Powell’s plans for the future (and that’s a… rarity).
In addition to announcing that he will not raise rates this month, JP also said:
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The Fed doesn’t need to see a recession to cut rates.
(Which is great, because many assumed his plan was to beat inflation by forcing a recession).
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Further interest rate increases are ‘not likely’.
Everyone had more or less assumed that, but JP had never said it outright; in fact, he had even threatened more walks.
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Interest rate cuts will be a topic of discussion in the future.
Apparently the Fed plans to cut rates by 0.75% in 2024!
The market fond of all of that – because markets like certainty – and for the past year we have been starved of it.
The economy is not yet out of the woods, but this is a good sign.