Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
The Federal Reserve continued to report This will reduce interest rates twice more this year, the president of the Fed, Jerome Powell, will adopt a perceived dominant position, a pleasant surprise for investors who have entered the political decision on Wednesday with increased fears on “stagflation” and the possibility of an American recession.
“This is a compensation event,” said Dennis Debusschere, president of 22V Research, in Yahoo Finance after the decision. “You did not have any Fed who was going to speed up the disadvantage in the markets.”
Find out more: How the decision of the Fed rate affects your bank accounts, loans, credit cards and investments
A great reason came from the “basic case” of the Fed that the inflation induced by the price will be “Transitional” And have a short -term “unique” effect on price growth. This was reflected in the projections of the Central Bank, which provided that the inflation of the end -of -year PCE passing by 2.7% before reaching its target of 2% by 2027 – “a relief for investors” which had fought at more sticky prices, according to Debusschere.
But some experts warn that “transient” inflation remains an unrealistic expectation – and that projections of two rate drops this year could collapse like the Trump administration continues to switch to trade policy. Powell himself said “There is a level of inertia” To remain in accordance with previous forecasts until greater clarity emerges.
“Uncertainty was a highlight of the declaration,” Rick Rieder, Director of Investments at Global, wrote to Blackrock, in response to Wednesday’s decision. “Like market players, the Fed is at a very uncertain point, and it needs time and data to determine the following plan.”
Inflation of consumers and producers has shown a deceleration in price growth in February. But the details below the surface indicated a potential By achieving the target 2% target, prices used as a bigger threat to the Powell “transitional” basic case.
There are also concerns that the Fed can reduce rates due to a weakening of the labor market and slowdown in economic growth – A decision that would not be applauded by investors.
“Everyone wants two cups, three cups, four cups. You don’t want any cuts. You want profits. You want a strong economy,” Ken Mahoney, CEO of Mahoney Asset Management on Thursday. “Pay attention to what you want.”
Despite a slightly more attempt in the central bank, with more FOMC members providing that interest rates are stable or lowered by 0.25% instead of 0.50% consensus, traders have always increased their own expectations of the place where interest rates could end the year.
