Chair of the Federal Reserve Jerome Powell is going to give a speech today about the recent volatility of the stock market that happened this week.
Watch Federal Reserve Jerome Powell Speech Today Live Stream
According to central bank officials, higher borrowing costs may begin in March as a result of the strong labor market and high inflation. Since March 2020, interest rates have been near zero.
Federal Reserve Jerome Powell Speech Today
A volatile trading session followed the 2 p.m. release of the Fed’s policy statement, with the S&P 500 beginning the session with a gain of more than 2 percent before losing some of the gains. Soon after the release, the Nasdaq composite was up 3 percent.
Since the pandemic erupted in March 2020 and caused a recession, the Fed’s benchmark interest rate has been near zero. Economists expect several more rate hikes later in the year, with the Fed raising this rate by a quarter point in March.
In March, the Fed will also cease its monthly bond purchases to further tighten credit. It may also start reducing its large stockpile of Treasury and mortgage bonds later this year. Together, these moves represent a dramatic shift away from the ultra-low-rate policies imposed during the pandemic recession.
Federal Reserve Jerome Powell Live Stream
As a result of the Fed’s actions, a wide range of borrowing – from mortgages and credit cards to auto loans and corporate credit – will become more expensive. Increased borrowing costs, in turn, will affect consumer spending. One of the most serious risks is that the Fed will abandon its low interest rate policy, which has nourished the economy and financial markets for years.
S&P 500 index rose 1.8% before Wednesday’s updated policy statement from the Fed. The benchmark index has fallen 7.5% from its all-time high, nearing a 10% decline, which is considered a correction by investors.
