Wednesday, May 31, 2023
HomeEconomyFed's Kashkari: 'happy' with market reaction to Powell speech - Bloomberg

Fed's Kashkari: 'happy' with market reaction to Powell speech – Bloomberg

(Reuters) – Minneapolis Federal Reserve Bank President Neil Kashkari said on Monday he sees a sell-off in stocks following a hawkish speech from Fed Chairman Jerome Powell on Friday , suggesting investors understand that central banks are serious about reducing inflation.

“I was really happy to see Chairman Powell’s speech at Jackson Hole being welcomed,” Kashkari told Bloomberg’s Oddlots podcast. “People now understand the seriousness of our commitment to bring inflation back to 2 percent,”

All three U.S. stock benchmarks on Friday said at Powell’s annual central bankers meeting in Jackson. Both fell more than 3 percent in Hole, Wyoming, where the Federal Reserve will raise interest rates as needed to slow growth and soften the labor market.

He also said the Fed will keep policy restrictive “for some time” to bring down inflation, which is now more than three times the Fed’s 2% target.

“I’m certainly not excited to see the stock market rebound after our last FOMC meeting,” he added, referring to The Fed’s policy-setting group, which last met in July 26-27 and raised rates for the second time in a row 75 – basis point rate hike.

Powell said at the time that the Fed would start to slow the pace of rate hikes at some point, a sentiment he also made on Friday, even though he stressed that the Fed’s rate hikes would give households and businesses a boost Bring “some pain”.



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