Powell asked about recession, dodges question
Powell did not answer the question directly when asked if he sees a recession upon us? — Sees slowdown and says “we are focused on getting inflation down”…
We don’t think we need to have a recession he added…
Mortgage rates may not move that much higher
“The Federal Reserve raised its short-term fed funds rate by 75 basis points, but this is unlikely to do any further damage to mortgage rates. The long-term bond market, off of which mortgage rates are generally priced, has mostly priced-in all future actions by the Fed and may have already peaked with the 10-year Treasury shooting up to 3.5% in mid-June. It is at 2.8% a few minutes after the Fed’s decision on its new monetary policy. So, it is possible that the 30-year fixed mortgage rate may settle down at 5.5% to 6% for the remainder of the year. Still, mortgage rates are significantly higher now compared to one year ago, which is why home sales have been falling” stated the National Assn. of Realtors.
Another large rate hike ahead?
Another unusually large rate hike after the two back-to-back 75 basis point increases may be appropriate, data depending, says Powell…
Fed must be “nimble” to incoming data during these uncertain times…
Powell details headwinds of slowdown
Housing has weakened reflecting higher mortage rates, business fixed investment slowing along with consumer spending and production says Powell
Fed updates inflation stance
Following the 75 basis point rate hike, policymakers also refreshed their view on inflation.
INFLATION REMAINS ELEVATED
REFLECTS SUPPLY & DEMAND IMBALANCES
RELATED TO HIGHER FOOD, ENERGY PRICES
STRONGLY COMMITTED TO GETTING INFLATION TO 2%
HIGHLY ATTENTIVE TO INFLATION RISKS
Stocks build on gains post latest Fed hike
U.S. stocks gained some momentum after the Federal Reserve raised rates by 75 basis points. Large-cap tech, including Microsoft and Google, helped pace the gains.
Nasdaq Composite Index.