He did make sure to include some caveats in that the Fed "can't really know" if the impact will be temporary. However, that is all drowned out by the noise of just one word. And when you bring that back after having been humbled the first time during the 2021-2022 inflation surge, it's bound to echo more strongly.
Besides that, the other key takeaway was that Powell reaffirmed the Fed is not in a hurry to change its current policy stance.
As for the dot plots yesterday, they were not too interesting. The median dots remained the same as in December, though more policymakers did see rates higher in 2025 than previously.
But unless we get a better idea on the impact of Trump's tariffs, it's still a waiting game. And in trying to soothe markets, Powell dug into the discard pile and pulled out the "transitory" card. I don't think this was on the bingo card for many this year.
This article was written by Justin Low at www.forexlive.com. Read More Details
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