“People were looking for the Fed to say we will cut, but Powell saying we need to study this is a disappointment,” said Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute. “He is talking about unemployment, but he is not talking about how the Fed is going to ride to the rescue with rate cuts.”
A relatively calm day on the stock market turned turbulent after Jerome Powell made clear the US Federal Reserve remains on war-footing against inflation, even if that means risk assets suffer.
It was a message equity investors weren’t expecting after two weeks of volatility following President Donald Trump’s unveiling of punitive tariffs on scores of countries. A violent selloff that gave way to the best one-day rally since 2008 had investors anticipating the Fed chair would indicate a willingness to step in if the economy showed signs of weakness.
