Powell Says Full Steam Ahead On Rate Hikes Despite Market Turmoil

Though Powell paid lip service today on the Fed watching markets closely, most of the mainstream ignored the most important statement he made - the assertion that the Fed WILL CONTINUE RATE HIKES even as stocks experience turmoil.  This is exactly as I predicted before Powell took the Fed chair.   Expect volatility to rise and markets to crumble further as 2018 progresses.  Powell WILL raise rates and cut the balance sheet regardless of stock behavior - everything has now changed since the Yellen era...

 

Federal Reserve Chairman Jerome Powell suggested that the U.S. central bank would push ahead with gradual interest-rate increases even as it remains on the lookout for threats to the financial system in the wake of the recent stock market rout.

“We are in the process of gradually normalizing both interest rate policy and our balance sheet,” he said Tuesday in the text of his ceremonial swearing-in speech in Washington, adding, “We will remain alert to any developing risks to financial stability.”

They were Powell’s first public comments since financial markets last week suffered their most severe bout of volatility in years, partly on concern that rising wages might spur inflation and prod the Fed into faster rate hikes.

While the new Fed chairman didn’t specifically mention the steep fall in share prices, other central bank officials have played down its impact on the economy and the financial system.

Federal Reserve Bank of New York President William Dudley last week called the share shakeout “small potatoes,” while Cleveland Fed President Loretta Mester said on Tuesday that the turmoil hadn’t affected her economic outlook or her support for further interest-rate hikes.

 

READ MORE HERE:

https://www.bloomberg.com/news/articles/2018-02-13/powell-suggests-fed-to-go-ahead-with-rate-hikes-after-share-rout

 

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