Part of Wall Street’s concern is that the Fed has room to be aggressive in its fight against inflation because the Omicron variant of the coronavirus appears, by some measures, to be less severe than previous forms. They also discourage investors from bidding up risky assets like stocks. Higher rates can slow the economy, making borrowing for houses, cars and business costs more expensive. No matter, there’s no question that investors have become unsettled by the idea that interest rates will rise this year. Powell, to signal changes well in advance so as not to surprise markets. It’s a concern that belies efforts by the Fed chair, Jerome H. The worry, which several analysts see as overblown, is that the Fed will decide it is starting its inflation fight too late and move more aggressively than investors anticipate.
It will provide some much-needed clarity on where the Fed officials’ heads are.” “That’s why tomorrow’s Fed meeting is important. “The market has been behaving incoherently, not knowing whether to go down because the Fed is tightening or go up because the Fed is actually taking action to rein in inflation,” said Anu Gaggar, a strategist for Commonwealth Financial Network. The central bank has already said it will soon stop buying government bonds, and investors expect it to start raising interest rates in March.īut stock investors were agonizing over what the Fed may say on Wednesday as it concludes a two-day meeting, and that has led to the big swings in prices this week. Investors are focused on the Fed’s next move as it focuses on slowing inflation by pulling back on its support for the economy.
0 kommentar(er)
