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Stock market at this time: S&P 500 set to construct on document excessive as Powell kicks off semiannual testimony

Jul 9, 2024 | blog

Federal Reserve Chair Jerome Powell kicked off his semiannual replace to Congress on Tuesday, showing earlier than the Senate Banking Committee. He will seem earlier than the House Financial Services Committee tomorrow.

Yahoo Finance’s Jennifer Schonberger has the story:

Powell indicated the central financial institution is inching nearer to feeling snug about rate of interest cuts, saying that he was inspired by proof of cooler inflation and that extra “good data” would assist get the Fed to the place it desires to be.

The inflation numbers “have shown some modest further progress” after some hotter readings within the first quarter, “and more good data would strengthen our confidence that inflation is moving sustainably toward 2%,” he said in prepared testimony before US lawmakers Tuesday.

It is the second time in the last week Powell has offered optimism about the inflation picture. Last Tuesday he noted that the last two inflation readings from April and May “do recommend that we’re getting again on a disinflationary path.”

FILE - Federal Reserve Board Chair Jerome Powell speaks at a news conference at the Federal Reserve in Washington, June 12, 2024. Powell testifies to the Senate Banking Committee on Tuesday, July 9, 2024. (AP Photo/Susan Walsh, File)

Federal Reserve Board Chair Jerome Powell speaks at a news conference at the Federal Reserve in Washington, June 12, 2024. (AP Photo/Susan Walsh, File) (ASSOCIATED PRESS)

The subsequent studying on inflation as measured by the Consumer Price Index is due out Thursday.

It isn’t anticipated to indicate inflation getting worse, however it additionally isn’t anticipated to drop, both. Based on “core” CPI — which excludes unstable meals and power costs the Fed can’t management — inflation is predicted to carry regular at 3.4% in June from the identical degree in May.

Powell famous in his ready testimony the Fed will proceed to make selections on financial coverage assembly by assembly. He reiterated that reducing charges too rapidly may reverse progress on bringing inflation down, whereas preserving charges elevated for too lengthy may weaken the economic system and the job market.

Democrats are anticipated to press Powell to decrease charges quickly, whereas Republicans are prone to press Powell on financial institution capital guidelines and emphasize that charges should not be lower too near the election in November.

Powell in his testimony underscored that Congress has entrusted the Fed with the operational independence that’s wanted to take a “longer-term perspective” within the pursuit of its twin mandate of most employment and secure costs.

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