Welcome to Extreme Investor Network, where we provide you with the latest insights and analysis on the Stock Market, trading, and all things related to Wall Street. Today, we delve into Federal Reserve Chair Jerome Powell’s recent comments on the PPI data and the outlook for Fed policy.
Powell acknowledged that the recent PPI report was mixed, with revisions to the March numbers showing a decline in both PPI and Core PPI. Despite this, Powell remains optimistic about solid growth and a strong labor market, but his confidence in the inflation picture has waned.
Looking ahead, Powell hinted that the current interest rate environment may persist longer than anticipated, with a rate cut being a more likely scenario than a rate hike. He believes that the current policy rate is restrictive, but the Fed requires more time to assess its impact.
When questioned about U.S. debt and fiscal policy, Powell expressed concerns about the unsustainable path of fiscal policy. However, he noted that these issues are not currently influencing Fed decision making significantly.
The U.S. Dollar Index reacted to the PPI data and Powell’s comments, pulling back as traders reacted to the news. The index is now attempting to break below the 105.00 level, while Treasury yields are declining as traders anticipate that the Fed will not raise rates in the near future.
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