Federal Reserve Chair Powell gave testimony in the US Senate on Tuesday and repeated the message to the House on Wednesday.

For what he said and its impact, summary here:

Nick Timiraos at the Wall Street Journal has handed down his take:

The Journal is gated, if you can't access the article, in brief:

  • It didn’t move markets, but during two days of congressional testimony this week, Federal Reserve Chair Jerome Powell made the beginning of a pivot on interest rates that might prove more durable than one that sparked a big market rally at the end of last year.
  • When inflation turned up in the first quarter and the economy showed solid growth, the justification for lower rates crumbled. But when Powell returned to Capitol Hill this week, he began laying the groundwork for rate cuts on what could prove to be a stronger footing. He pointed to how a cooling labor market means a potential source of ongoing, high inflation has diminished. And he suggested that any further softening in the job market might be unnecessary and unwelcome.

Equity markets are reflecting a similar take. The rally goes on.

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