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What were levels ahead of the Fed Chair Press conference.
U.S. Stocks
- Dow Jones: 51,957.19 (-795.10, -1.51%)
- S&P 500: 7,392.95 (-35.82, -0.48%)
- Nasdaq Composite: 24,798.83 (-87.08, -0.35%)
- Russell 2000: 2,924.86 (-28.94, -0.98%)
- Nasdaq 100: 27,605.74 (-157.40, -0.57%)
U.S. Treasury Yields
- 2-Year: 4.2706% (-0.64 bps)
- 3-Year: 4.3095% (+0.65 bps)
- 5-Year: 4.3820% (+2.10 bps)
- 7-Year: 4.5048% (+2.48 bps)
- 10-Year: 4.6366% (+3.26 bps)
- 20-Year: 5.1554% (+4.14 bps)
- 30-Year: 5.1534% (+3.94 bps)
Commodities & Bitcoin
- WTI Crude Oil: $84.44 (+$5.32, +6.72%)
- Gold: $4,065.07 (+$36.77, +0.91%)
- Silver: $58.1162 (+$1.0072, +1.76%)
- Bitcoin: $64,012 (+161, +0.25%)
Market Snapshot:
Ahead of Kevin Warsh’s first Fed press conference, equities remained under pressure, led by a sharp 1.5% decline in the Dow. Treasury yields were mixed, with the curve steepening as longer-dated yields moved higher. Meanwhile, oil surged nearly 7% and precious metals advanced, reflecting heightened geopolitical concerns and inflation uncertainty going into the Fed Chair’s remarks.
Prepared comments from Fed Chair:
- Discussion was collegial
- The economy is showing impressive resilience even with the recent shocks
- the committee remains resolute to deliver price stability.
- The committee is a steering clear of forecasting
- the 5 years of high inflation has left an impression that is hard to shake that Fed’s implicit price target was above 2%.
- Says that there is no soft target only one target and its 2%.
- Inflation cannot be cured in 9 weeks. There was nothing in there about our discussions or strategy
- Nominal and real yields are material higher
- some of the increases between FOMC meetings are among the most significant in decades.
- Markets are paying attention to the ball and not the referee.
- Markets will continue to respond in direction and magnitude as they see fit.
- The most striking feature is the strong growth in investment.
- Investment is helping to maintain the growth and laying the groundwork for future growth.
- Vigorous discussion centered on 4 questions. 1. Implications on high inflation over the last 5 years. 2. Considerd the recent economic shocks an effects on output and employment. 3. Talked about price increases arising from this shocks. Do the changes lead to a broader inflation dynamic 4. Discussed monetary policy tools and strategies.
Q&A
- I am trying to get an unfiltered message from the market. What does not mean out how doing on inflation.
- Trying not to interfere with the market signals.
- We are observing but trying to stay out of it.
- Interpreting markets is an imperfect business.
- Economy output is solid, labor market solid – steady.
- Bond market is saying that as well
- We have not much, but the bond market has been doing work.
- Asked for a good family fight and got one
- There was a lot of agreement that I heard that we have the power to deliver stable prices.
- Like to believe that the committee shares my views that the historic problem with data dependence is the data and dependence.
- The committee cares about trends on the data.
- Do not want to leave impression we are breathlessly waiting for incoming data.
- I would not say we over relied on a single price of data.
- Rates are higher than they have been 42 days ago. Markets have moved rates higher.. Markets have made their judgments
- monetary policy matters not just by what we say or do, monetary policy matters by how it affects the real economy. The prices in the market are one of the ways how policy affects the economy.
This article was written by Greg Michalowski at investinglive.com.
