Today Fed can hike and earn respect on Wall Street
Or surrender to the market and the cheerleaders there.
Fed looks determined to take rates higher
As expected, the committee announced Wednesday that it was not going to raise interest rates, the first time it has skipped an opportunity to do so since early 2022.
As not expected, it accompanied this by publishing an update of governors’ projections showing that the great majority expect the fed funds rate to reach 5.6% by the end of this year.
If they’re so much more convinced that rates need to be higher for longer, why pass on an opportunity to raise them now?
Decided against inflicting a nasty surprise on the market by hiking.
you can't have the incoming vice chair be proven immediately wrong.
As has been happening a lot recently, Fed Chair Jerome Powell went into his press conference with a clear message, and by the end the market collectively convinced itself that he hadn’t meant it.
But how important is the press conference, really? Perhaps not very.
By suggesting that there are two more hikes to come, he has at least managed to persuade everyone that there will be no cuts. And that may have been his most important task. What happens next depends on the economy.
John Authers Bloomberg 15 juni 2023
Stock Market to Fed: You Haven’t Done Enough
Bullish stocks, low bond yields and recovering housing market suggest interest rates aren’t that restrictive
Greg Ip WSJ 14 June 2023
https://www.wsj.com/articles/stock-market-to-fed-you-havent-done-enough-45c7a23e
Kommentarer