Powell gives all clear for stocks to keep moving higher
Federal Reserve Chair Jerome Powell speaks during a Senate Banking Committee hearing on Capitol Hill, Washington, December 1, 2020.
Al Drago | Pool | Reuters
Fed Chairman Jerome Powell signaled that the central bank is not looking to tighten policy any time soon, a bullish sign for stocks and other risk assets.
Powell spoke following the Fed’s two-day meeting Wednesday and surprised bond market pros with his comments that the central bank is not close to discussing paring back its $120 billion a month bond-buying program.
Some strategists have expected the Fed to discuss tapering purchases as soon as its June meeting.
In its statement, the Fed acknowledged that the economy is improving, and it expects a spurt of higher inflation, albeit temporary. Powell told the press briefing that there was still a large amount of slack in the labor market, despite improvement.
