In the Fed Chairman’s view, the U.S. economy is in a good place, and American monetary policy is appropriately calibrated to handle any risks, despite rising uncertainty and slightly worse-than-expected labor market data. Jerome Powell emphasized that the labor market situation is balanced and that wage growth (exceeding inflation) does not threaten price dynamics.
In the medium term, a potential challenge could be how consumption and corporate investment evolve amid heightened concerns regarding the new U.S. administration’s policies. Nevertheless, Powell noted that the Fed would not overreact to any single macroeconomic data reading, especially since there are no worries about the “long-run” outlook.
EURUSD is retreating by 0.25% in response to Powell’s press conference, which reassured markets about stagflation risks, highlighted the solid fundamentals of the U.S. economy, and emphasized that current interest-rate levels are comfortably positioned.
Source: xStation 5
Daily Summary: Powell pulls markets back up! π EURUSD higher
EURUSD higher after Powell's speech! πΆπ
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