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You can find the current article at its original source at https://www.theguardian.com/business/live/2019/jan/30/french-economy-growth-gdp-uk-credit-us-federal-reserve-brexit-pound-business-live
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| Stocks surge as Fed leaves US interest rates on hold and promises 'patience' - live | Stocks surge as Fed leaves US interest rates on hold and promises 'patience' - live |
| (35 minutes later) | |
| Nothing in Jerome Powell’s press conference dented the upbeat mood in the markets. | |
| Investors are cheered that the Fed has pressed the pause button on its rate hike cycle, and wondering if the next move might be to rewind.... | |
| Dove is in the air, everywhere I look around. Fed says it will be "patient" on further rate hikes - Dow up 2% to its highest in almost 2 months, 10y yield down to 2.68%, yield curve steepens. pic.twitter.com/YNT2pFoTl9 | |
| #BREAKING US would feel disruptions from hard Brexit, says Fed's Powell pic.twitter.com/AG7zuEr5Xu | |
| Asked about Brexit, Jerome Powell says that the Fed is taking steps to ensure America’s financial system can cope with “a full range” of outcomes. | |
| He also warns that a hard Brexit would have an impact on the US, especially if it caused financial turmoil. | |
| Powell: -We've monitored brexit carefully for a long time-Hard brexit would likely be felt in U.S.-Hoping for resolution that avoids a hard brexit | |
| Q: Have you just caved to President Trump? | Q: Have you just caved to President Trump? |
| All we care about is using our tools to help the American people, Powell replies in a particularly serious tone. We don’t get involved in politics. | All we care about is using our tools to help the American people, Powell replies in a particularly serious tone. We don’t get involved in politics. |
| We’re human, we make mistakes, but we don’t make mistakes of character or integrity. | We’re human, we make mistakes, but we don’t make mistakes of character or integrity. |
| Q: Have we reached the end of the US rate-hiking cycle, rather than simply pausing it? | Q: Have we reached the end of the US rate-hiking cycle, rather than simply pausing it? |
| Powell says we’ll only know in hindsight. | Powell says we’ll only know in hindsight. |
| Q: What’s changed since the Fed’s last meeting, just six weeks ago (when Powell was predicting gradual rate hikes) | Q: What’s changed since the Fed’s last meeting, just six weeks ago (when Powell was predicting gradual rate hikes) |
| Powell says recent data have shown that the slowdown in China and Europe has continued. | Powell says recent data have shown that the slowdown in China and Europe has continued. |
| He also cites the US government shutdown, saying it will have “some impact on first-quarter US GDP”. | He also cites the US government shutdown, saying it will have “some impact on first-quarter US GDP”. |
| But if the shutdown row is now over, then much of that lost activity should be clawed back. | But if the shutdown row is now over, then much of that lost activity should be clawed back. |
| Q: Has the Fed considered changing the pace of unwinding its asset purchase scheme? | Q: Has the Fed considered changing the pace of unwinding its asset purchase scheme? |
| Powell insists that no decisions have been taken, but discussions are underway [the issue here is how large the Fed’s balance sheet should be in the long term] | Powell insists that no decisions have been taken, but discussions are underway [the issue here is how large the Fed’s balance sheet should be in the long term] |
| Q: Your statement talks about adjustments, so might the next interest rate move be up, or down? | Q: Your statement talks about adjustments, so might the next interest rate move be up, or down? |
| It depends entirely on the data, Powell says, adding that the ‘cross-currents’ facing America could be with us for a while. | It depends entirely on the data, Powell says, adding that the ‘cross-currents’ facing America could be with us for a while. |
| FOMC statement refers to "adjustments" to rates. Rich Miller asks if that means rates are as likely to go up as down. Powell comes close to suggesting that Fed doesn't know if next move will be up or down. | FOMC statement refers to "adjustments" to rates. Rich Miller asks if that means rates are as likely to go up as down. Powell comes close to suggesting that Fed doesn't know if next move will be up or down. |
| Asked about economic risks (such as Brexit, and trade wars), chairman Powell says Fed officials believe the economic outlook is “still solid”. | Asked about economic risks (such as Brexit, and trade wars), chairman Powell says Fed officials believe the economic outlook is “still solid”. |
| Q: Are US interest rates now at neutral? (ie, neither stimulating nor holding back the economy?). | Q: Are US interest rates now at neutral? (ie, neither stimulating nor holding back the economy?). |
| Powell says policy is ‘appropriate’, adding that the Fed funds rate is within the ‘range’ of neutral. | Powell says policy is ‘appropriate’, adding that the Fed funds rate is within the ‘range’ of neutral. |
| “We think our policy is at the appropriate point,” Powell says, indicating that the Fed isn’t sure anymore whether it’s still helping to boost the economy. | “We think our policy is at the appropriate point,” Powell says, indicating that the Fed isn’t sure anymore whether it’s still helping to boost the economy. |
| Fed funds rate is now in the range of the FOMC's estimates of neutral, Fed's Powell says at press conference. | Fed funds rate is now in the range of the FOMC's estimates of neutral, Fed's Powell says at press conference. |
| Dow up over 400 points as Powell says the case for raising rates has weakened and the Fed is taking a "wait and see" approach | Dow up over 400 points as Powell says the case for raising rates has weakened and the Fed is taking a "wait and see" approach |
| Powell says the case for further interest rate rises has ‘weakened somewhat’, as inflationary pressures have declined. | Powell says the case for further interest rate rises has ‘weakened somewhat’, as inflationary pressures have declined. |
| Pretty dovish stuff from Fed Chair Powell so far: - Case for raising rates has weakened somewhat - Risk of too high inflation has diminished | Pretty dovish stuff from Fed Chair Powell so far: - Case for raising rates has weakened somewhat - Risk of too high inflation has diminished |
| Federal Reserve chair Jerome Powell is holding a press conference now. | Federal Reserve chair Jerome Powell is holding a press conference now. |
| Powell gives a recap of the Fed’s meeting. | Powell gives a recap of the Fed’s meeting. |
| He says the Fed’s mission is to “sustain the economic expansion with a strong jobs market and stable prices, for the benefit of the US people.” | He says the Fed’s mission is to “sustain the economic expansion with a strong jobs market and stable prices, for the benefit of the US people.” |
| The US economy is in a good place, and we’ll use our tools to keep it there, Powell pledges. He says the jobs markets looks strong, and inflation is close to target. | The US economy is in a good place, and we’ll use our tools to keep it there, Powell pledges. He says the jobs markets looks strong, and inflation is close to target. |
| Looking ahead.... the Fed expects the US economy to do well in 2019, but not as fast as the very strong growth in 2018. | Looking ahead.... the Fed expects the US economy to do well in 2019, but not as fast as the very strong growth in 2018. |
| But growth has slowed in China and Europe, and there is uncertainty over Brexit, trade discussions, and the US government shutdown. | But growth has slowed in China and Europe, and there is uncertainty over Brexit, trade discussions, and the US government shutdown. |
| These ‘cross-currents’ could hurt the US economy. So the Fed has decided to be patient - basically, wait and see how conditions play out. | These ‘cross-currents’ could hurt the US economy. So the Fed has decided to be patient - basically, wait and see how conditions play out. |
| Markets agree that Patience is a virtue. #Fed $SPY | Markets agree that Patience is a virtue. #Fed $SPY |
| ....and a buying opportunity. | ....and a buying opportunity. |
| Candice Bangsund, Vice President and Portfolio Manager at Fiera Capital, predicts the Fed will leave US interest rates unchanged until at least July. | Candice Bangsund, Vice President and Portfolio Manager at Fiera Capital, predicts the Fed will leave US interest rates unchanged until at least July. |
| We expect the Fed to take a pause and remain sidelined through the first half of the year in order to monitor the evolution of the macroeconomic landscape and recommence with two more rate hikes in the back half of the year.” | We expect the Fed to take a pause and remain sidelined through the first half of the year in order to monitor the evolution of the macroeconomic landscape and recommence with two more rate hikes in the back half of the year.” |