Fed Chair Powell (Q&A) says the long-term thinking is to look through energy shocks, but that also depends on inflation expectations
- Says oil companies will want to see consistent rise in oil prices, and believe its persistent, in order to increase production
- Not seeing that happen now, but it could happen over time
- Net of oil shock will be some downward pressure on spending and employment, and upward pressure on inflation
Context
Fed Chair Powell's remarks highlight a longer-term perspective on energy shocks and their impact on inflation expectations. The emphasis on consistency in oil prices reflects concerns over spending and employment, suggesting a cautious outlook on economic growth. This could influence the Fed's policy stance, particularly if inflation pressures persist, affecting USD and fixed income markets.
Trade the TapeGet this analysis live, the moment it breaksNewsquawk's real-time dashboard delivers market-moving headlines and instant context to your desk before the rest of the market reacts.
Open Dashboard#UNITED STATES#USD#JAPAN#UNITED KINGDOM#IMPORTANT#FOREX#FIXED INCOME#US SESSION#FEDERAL RESERVE#CENTRAL BANK#INFLATION#DXY