Fed chair Powell
- makes sense to moderate pace of interest rate hikes
- time to moderate pace of rate hikes may come as soon as December
- have made substantial progress toward sufficiently restrictive policy, have more ground to cover
- it seems to me likely rates must ultimately go somewhat higher than policymakers thought in September
- likely to need to hold policy at restrictive level for some time
- history portions strongly against prematurely loosening policy
- we have a long way to go on restoring price stability
- we will stay the course until the job is done
- October inflation data was welcome a surprise; will take substantially more evidence to give comfort inflation is actually declining
- we estimate PC price index rose 6% in 12 months through October
- the path ahead for inflation remains highly uncertain
- moderation in labor demand growth will be required to restore labor market balance
- so far seen only tentative signs of moderation in labor demand, wage growth
The initial reaction is a decline in the US dollar.
- The EURUSD moved back up to test its 200 hour moving average of 1.03475. That is where trades right now.
- The GBPUSD is also moved up to retest its 200 hour moving average at 1.19754.
In the US stock market,:
- Dow industrial average moved from -158 points to -9.58 points currently
- S&P index moved from -10.32 points to +13.12 points currently
- NASDAQ index moved from +14.75 points to +94.17 points
For the full text of the Fed Chair speech CLICK HERE.