Comic: Powell Says What Markets Want To Hear As Fed Signals July Rate Cut

Comic: Powell Says What Markets Want To Hear As Fed Signals July Rate Cut  | Jul 11, 2019 13:42

Comic: Powell Says What Markets Want To Hear As Fed Signals July Rate Cut

By Jesse Cohen - U.S stocks looked set to extend their run to fresh record highs on Thursday, after Federal Reserve Chair Jerome Powell sent his clearest signal yet that the U.S. central bank will cut interest rates for the first time in a decade later this month.

In testimony to the House Financial Services Committee on Wednesday, Powell said that since Fed officials met last month, “uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook.”

The Fed boss confirmed that the U.S. economy is still under threat from disappointing manufacturing activity, weak inflation and an ongoing trade war.

Powell added that the central bank will “act as appropriate” to sustain expansion as “crosscurrents” are weighing on the economic outlook.

Powell’s dovish testimony saw traders revive some bets on heftier easing at the Fed’s next policy meeting on July 30-31.

The chance of a 50-basis-point cut stood at around 33% Thursday morning, up sharply from just 3% at the start of the week.

A strong U.S. jobs report released late last week had tempered expectations the Fed will deliver a large rate cut at its July meeting.

The hearing took place against the backdrop of U.S. President Donald Trump's frequent criticism of the Fed and the White House's demands that the central bank lower rates.

Powell will resume his testimony, this time to the Senate Banking Committee, at 10:00AM ET (1400 GMT).

In the wake of Powell’s comments, the dollar sagged, moving further away from a three-week peak, while the U.S. Treasury yield curve steepened.

The S&P 500 briefly broke above 3,000 for the first time, while the Nasdaq Composite and Dow Jones Industrial Average also reached all-time highs.

To see more of’s weekly comics, visit:

-- Reuters contributed to this report

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (India) English (Canada) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 中文 香港 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
Saving Changes