Good grief, the markets are applauding like a bunch of trained seals clapping their flippers.
From Yahoo Finance, August 23:
Investors solidified bets on how deeply the Federal Reserve will cut interest rates this year after Fed Chair Jerome Powell said Friday the "time has come for policy to adjust."
Powell noted the timing and pace of cuts will "depend on incoming data," but markets quickly moved to fully price in four rate cuts of 0.25% by the end of 2024 on Friday morning after the Fed chair said the central bank has "ample room" to maneuver as policy enters its next phase.
"The current level of our policy rate gives us ample room to respond to any risks we may face, including the risk of unwelcome further weakening in labor market conditions," Powell said.
Stocks rallied following Powell's speech, with the S&P 500 (^GSPC) rising 1% and the tech-heavy Nasdaq Composite (^IXIC) gaining more than 1.3%. The Dow Jones Industrial Average (^DJI) rose about 1.1%, or more than 400 points, and the interest rate-sensitive Russell 2000 (^RUT) small-cap index soared, rising more than 2.5%.
Renaissance Macro head of Economics Neil Dutta highlighted in a note to clients that Powell didn't use the word "gradual" when referring to rate cuts like some other Fed officials had in recent days.
This, Dutta argued, suggests "Powell is not removing the optionality of doing large moves as policy adjusts."
Markets appear to agree.
Though with only three Fed meetings left in 2024, the looming question remains when the Fed would cut rates by 0.50% in a single meeting to reach the current investor expectation of four interest rate cuts this year....
....MUCH MORE
Also at Yahoo FinanceFed's Powell says 'time has come' for interest rate cuts
It should be easy to take some money off of this crowd. Here's the Fed Open Market Committee calendar for the rest of the year:
September
17-18*
November
6-7
December
17-18*
* Meeting associated with a Summary of Economic Projections.
S&P 500 5,614.47 +43.83(+0.79%)
Nasdaq 17,810.27 +190.92(+1.08%)
