Jerome Powell seemed like he was speaking from the same say-nothing script as Michele Bullock. But then he set markets alight with a bizarre statement.
Having listened to the post-meeting press conferences from the Federal Reserve and Reserve Bank bosses over the past few days, Chanticleer was struck by similarities in their language and message. Somewhere, someone is surely playing a central bank drinking game, where players down a shot every time they hear one of the following phrases.Inflation remains too high. Drink! The risks are two-sided. Drink! We’ll be data-dependent. Drink! We remain committed to bringing inflation down.
The best example of that easing in financial conditions is, of course, the 27 per cent rise in the S&P 500, but there are plenty more, including a rise in US house prices and of course the surge in bitcoin, up 92 per cent over the same period. The fact that the dot plot is still showing the Fed expects three rate cuts this year was also somewhat surprising and, taken with Powell’s comment on financial conditions, sent the S&P 500 zooming almost 1 per cent to a fresh all-time high in the wake of the Fed’s official statement.
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