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2022-01-12

Powell Makes Case for Fed Curbing Inflation While Doing No Harm

Inflation is expected to reach 7% at the end of 2021 – then fall steadily

He portrayed those steps as a move away from an ultra-expansionary emergency policy put in place to fight the pandemic, not as a shift to a restrictive stance aimed at cooling off an over-heating economy.

 He told the Senate Banking Committee. “It really should not have negative effects on the employment rate.”

Former Treasury Secretary Lawrence Summers are likely to take little comfort from Powell’s words. “There isn’t going to be a path to less inflation without a cooler labor market,” the Harvard University professor and paid Bloomberg contributor said last week.

Bloomberg 11 January 2022

https://www.bloomberg.com/news/articles/2022-01-11/powell-makes-case-for-fed-curbing-inflation-while-doing-no-harm


US technology stocks rose on Tuesday after a sell-off in the $22tn Treasury bond market finally ran out of steam, as Federal Reserve Chair Jay Powell made assurances that the central bank would act to curb inflation before it gets out of control.


 

Stocks rebounded from a five-day slide after Jerome Powell reassured investors the Federal Reserve will tamp down inflation as the economy continues to recover.

 “If we have to raise interest rates more over time, we will,” 

The S&P 500 halted a five-day slide, the Nasdaq 100 outperformed major benchmarks and dollar fell.

Bloomberg 10 January 2022





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