Instant Reaction: Jay Powell on the Fed Decision
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What did Jay Powell say about the Fed's latest policy decision?
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This is a breaking news update from Bloomberg.
Instant reaction and analysis from our 3,000 journalists and analysts around the world. The beginning of a walk into the sunset for the chairman of the Federal Reserve. Jay Powell only has two more of these meetings on the calendar as the chairman. of the world's most important central bank. For the equity market on the S&P 500, still close to all-time highs on the S&P. On the Nasdaq 100, up by 0.5. In the bond market, on twos, tens and thirties, we look like this. Yields just about unchanged. Your 10-year, 425. Your two-year, 358. Journalists did their best to make this one interesting. Chairman Powell was determined to make it boring. Take a listen to what the chairman had to say.
Why did some Fed governors dissent regarding interest rate cuts?
Some people did want to cut and dissented, but committee pretty broadly for holding today. We still have some tension between employment and inflation, but it's less than it was. I think that the upside risks to inflation and the downside risks are probably both diminished a bit. So, you know, we'll be looking at that. There are different views on the committee and, you know, we'll find our way forward as the data evolve.
TK, just my takeaway, just my observation. Towards the end, it felt like a man who was looking forward to retiring and stepping down.
You know, there was a gold question. It's great. He doesn't have Krugerrands in the drawer. He's got the Jerry Garcia commemorative gold coins in the drawer. So way looser. There's no question about that. But it was really interesting to see the nuances of the market away from the things we usually quote.
folks to look at what seriously what sterling was doing the way euro was vibrating in that and i would suggest they can go back and say you know we got through that in one piece he's got some advice for the next fed chair stay out of politics stephanie roth of wolf research joins us now for more stephanie the questions loaded with politics he was not engaging he was not playing what was the takeaway for you
How is the US economy performing according to the Fed Chair?
Yeah, I think it's a Fed that is comfortable with the backdrop of data, which I think is the right call. The data seemed to be improving from here. We actually think that it will continue to get better, in which case this will certainly be the last cut under Chair Powell. There's no more cuts under Chair Powell. He's done. And I think that's right. He's fading into the sunset and just wants to avoid all of the questions that he didn't really want to answer.
Unfair question, but I can save it for your morning note at Wolf Research. Maybe it'll help. You think Mark Carney at Davos talking about the new geometry of middle countries. You look at the president, neomercantilism, the president, weak dollar. Did the secretary of treasury save this press conference by coming out hours before and sounding like James Baker from another time and place on strong dollar?
Yeah, I mean, last night it was getting to be a little bit concerning when Trump made the comments regarding his comfort around the sharp drop in the dollar that we've seen. That could also have reverberations throughout the rest of the market. So I think that is fair to some extent.
What role do tax refunds play in consumer spending?
Powell clearly don't want to comment on the dollar regardless. But there was the legitimate risk, and there still is, that there could become reverberations as the carry trade unwinds. But it seems that Besant is very well aware of the aftermath of that.
Can I ask economic questions? Please, go for it.
This is the appropriate forum.
Anna Wong has been great on this, as you have as well, Stephanie Roth, where the idea of the vector in goods we take for granted is disinflation. That's turned around. Now we've got goods moving up. We've got gold, copper and all the other stuff John's talking about.
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Chapters
8 chapters
1
What did Jay Powell say about the Fed's latest policy decision?
0:00–1:05
2
Why did some Fed governors dissent regarding interest rate cuts?
1:05–2:15
3
How is the US economy performing according to the Fed Chair?
2:15–3:15
4
What role do tax refunds play in consumer spending?
3:15–4:29
5
Why is there a tension between employment and inflation?
4:29–5:59
6
What are the implications of AI on the labor market?
5:59–7:21
7
How do current economic indicators affect Fed policy?
7:21–8:15
8
What challenges does the next Fed Chair face?
8:15–27:51
Speakers
7 identifiedMore from Bloomberg Talks
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