{"id":42958,"date":"2023-03-08T05:55:00","date_gmt":"2023-03-08T05:55:00","guid":{"rendered":"https:\/\/youtrading.com\/en\/?p=42958"},"modified":"2023-03-13T17:48:20","modified_gmt":"2023-03-13T17:48:20","slug":"morning-brief-powell-comments-sink-stock","status":"publish","type":"post","link":"https:\/\/youtrading.com\/en\/morning-brief-powell-comments-sink-stock\/","title":{"rendered":"Morning Brief – Powell Comments Sink Stock"},"content":{"rendered":"\t\t
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Stock market futures remain heavily in the red this morning and Asia stocks also suffered in the aftermath of yesterday\u2019s US session after Federal Reserve Chairman Jerome Powell on Tuesday cautioned that interest rates are likely to head higher than central bank policymakers had expected.<\/p>

The US dollar<\/a> is also notably stronger today, with the USDJPY<\/a> pair hitting a three-month trading high. Although the move was US dollar specific, on the data front we had Japan recording a record current account deficit, and trade deficit, in January.<\/p>

The global slowdown and China’s Lunar New Year holidays were cited in reasons. As a consolation prize, the primary income balance, another element of the current account, rose 350 bn yen from a year earlier to a 2.29 trillion yen surplus in January, driven by higher interest payments received from its investment in foreign securities.<\/p>

Markets are likely to grapple today with the Fed\u2019s Chairs comments as a shift in investor thinking is confirmed. Powell said the current trend shows that the Fed\u2019s inflation-fighting job is not over.<\/p>

He stated \u201cIf the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes,\u201d during prepared remarks for appearances this week on Capitol Hill.<\/p>

BlackRock<\/a>, the world\u2019s largest asset manager have also been out on the wires, noting \u201cthe Fed could raise interest rates to 6%\u201d and they could \u201ckeep them there for an extended period of time.\u201d<\/p>

They asset manager also states \u201cWe think there\u2019s a reasonable chance that\u00a0the Fed\u00a0will have to bring the Fed Funds rate to 6%, and then keep it there for an extended period to slow the economy and get\u00a0inflation\u00a0down to near 2%.”<\/p>

Investment Bank Goldman Sachs<\/a> said in a note to investors on Tuesday that it had raised its forecast for the so-called terminal rate by 25 basis points to a range of 5.5%-5.75%.<\/p>

Reserve Bank of Australia Governor Lowe spoke today following his shift to a touch less hawkish at yesterday\u2019s monetary policy decision. If you recall it was an as expected +25bp rate hike with a softer tone in the Statement.<\/p>

Lowe has pointed out that the data on jobs, retail spending, business surveys, along with PCI, are all important considerations. If those data suggest a pause is needed then the Board will pause its rate hikes.<\/p>

If not, then it will be another hike. Lowe said more aggressive rate hikes were considered and that this would bring CPI back closer to target prior to 2025 the bank currently forecasts, but this would come at a big cost in unemployment.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Stock market futures remain heavily in the red this morning and Asia stocks also suffered in the aftermath of yesterday\u2019s US session after Federal Reserve Chairman Jerome Powell on Tuesday cautioned that interest rates are likely to head higher than central bank policymakers had expected. The US dollar is also notably stronger today, with the […]<\/p>\n","protected":false},"author":4,"featured_media":42960,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[42,318,67,22],"yoast_head":"\nMorning Brief - Powell Comments Sink Stock - Youtrading UK<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/youtrading.com\/en\/morning-brief-powell-comments-sink-stock\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Morning Brief - Powell Comments Sink Stock Morning Brief - Powell Comments Sink Stock\" \/>\n<meta property=\"og:description\" content=\"Stock market futures remain heavily in the red this morning and Asia stocks also suffered in the aftermath of yesterday\u2019s US session after Federal Reserve Chairman Jerome Powell on Tuesday cautioned that interest rates are likely to head higher than central bank policymakers had expected.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/youtrading.com\/en\/morning-brief-powell-comments-sink-stock\/\" \/>\n<meta property=\"og:site_name\" content=\"Youtrading UK\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/YouTradingEnglish\/\" \/>\n<meta property=\"article:published_time\" content=\"2023-03-08T05:55:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-03-13T17:48:20+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/youtrading.com\/en\/wp-content\/uploads\/2023\/03\/GettyImages-522068694.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"661\" \/>\n\t<meta property=\"og:image:height\" content=\"452\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Nathan Batchelor\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Morning Brief - 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