Yesterday the stock market closed in the negative zone. Investors have fixed positions after the press conference of US FRS Jerome Powell. Talking points: - The US FRS expectly left the bank discount rate unchanged at 2.25-2.50%; - the political game of Donald Trump should not affect the work of the FRS; - The FRS plans to keep current rates for a long time; - the situation in the labor market and the economy is better than expected by the regulator; - inflation is still not rising, that requires the adoption of new measures to stimulate it. A target of 2% will be achieved in time. In general, the US FRS maintained a soft monetary policy. The regulator gave the main messages in March and now it just sticks to what has been said. Yesterday’s market reaction is only negative for those who expected a reduction of rate. But this would not be happen as long as the status quo is preserved: Donald Trump does not increase pressure on the FRS until the stock market is at its highs, and the FRS doesn't hurry, promising action only in the autumn.
02 May 2019
Yesterday the stock market closed in the negative zone
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