News Digest:

Market analysts aren’t sure. However, they note that the US Federal Reserve Chair Jerome Powell did suggest that their next policy move would not be a rate increase. He made these points during the two-day hearing at the Senate Banking Committee of the US Congress.

Reports said Powell’s testimony highlighted a cooling job market and persistently high prices, which is being perceived as a shift in emphasis away from its single-minded battle against inflation of the past two years. In fact, he noted that inflation had “eased notably” in the past two years though it was still above their 2% target.

Takeaway:

However, he argued that cutting rates “too late or too little could unduly weaken economic activity and employment” as the Fed raised rates 11 times to a two-decade high of 5.3% to fight inflation that peaked at 9.1% two years ago. In this context, he said the Fed’s next policy move would not be a rate hike, but as more progress is made on inflation, it will “begin to loosen policy at the right moment.”

End Notes

Source: https://www.cnbctv18.com/world/us-feds-jerome-powell-highlights-slowing-job-market-in-signal-that-rate-cuts-may-be-nearing-19440795.htm