empty
27.08.2020 06:16 PM
Fed Chair Jerome Powell's speech made currency markets flutter

This image is no longer relevant

Today, the long-awaited speech of the Chair of the US Federal Reserve, Jerome Powell took place at the symposium in Kansas City. As expected, Powell announced a global policy change, particularly the matter of targeting average inflation. It all basically comes down to not raising interest rates until inflation is above the standard target of 2%. Moreover, the Federal Reserve System intends to reconsider its approach to employment levels intending to focus on those with low incomes. Thus, the labor market should receive additional support, which, in turn, will contribute to the normalization of the situation in the country's economy.

All of these changes have been incorporated into a new policy plan program called the Long-Term Objectives and Monetary Strategy Statement.

In general, all the actions of the Fed can be reduced to one principle. In the event that the unemployment rate declines, then interest rates will not start to increase until this is reflected in inflation and it goes up.

A new approach to the problem of employment will be based on what estimates the Federal Reserve will give on its maximum level in the country. The main regulator remains deeply concerned about how the coronavirus pandemic has affected low- and moderate-income strata. It is the restoration of the balance in these sectors that the authorities will first of all deal with.

The head of the Fed noted that the regulator's plans do not intend to set artificial targets for unemployment. Moreover, all changes in further policy, on the contrary, will proceed solely from those conditions that will naturally develop in the market. Earlier, forecasts of the regulator reflected the fact that inflation should rise much earlier than the moment when the unemployment rate reaches 3.5%. However, this did not happen, to which Jerome Powell drew attention. In addition, Powell also stressed that an inflation rate of 2% is a perfectly acceptable target in the long term.

Immediately after the end of Powell's speech, everything was in disarray in the currency and stock markets. However, after a while, the situation stabilized, and the US dollar gradually began to recover. Most experts predict its potential growth in the near future.

Maria Shablon,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

US stock market in red zone: Dow Jones – 0.4%, Nasdaq – 0.1%. Upbeat corporate reports do not save Wall Street

The US stock market closed Tuesday with minor losses, as uncertainty over trade duties continued to weigh on investor sentiment. Consumer and healthcare stocks were particularly affected, though strong earnings

11:38 2025-04-16 UTC+2

US Market News Digest for April 16

Wall Street ended the session in the red. Shares of giants Boeing and Johnson & Johnson took the biggest hit as uncertainty around tariff policy continues to weigh on investor

Ekaterina Kiseleva 11:12 2025-04-16 UTC+2

Markets in the Red: Dow -0.4%, Nasdaq -0.1% as Strong Reports Fail to Save Wall Street

Bank of America Gains After Higher Q1 Earnings Uncertainty Over Tariff Outlook Still High Markets Ripple on U.S.-China Debate Indices: Dow Down 0.4%, S&P 500 Down 0.2%, Nasdaq Down 0.1%

Thomas Frank 07:54 2025-04-16 UTC+2

Apple soars. Stock investors alert to Netflix' report

US stocks are printing modest gains as tariffs on some electronic goods have been delayed. Tech stocks are outperforming European and Asian counterparts, with Apple shares jumping. Goldman Sachs

11:42 2025-04-15 UTC+2

US Market News Digest for April 15

The Trump administration has made concessions: tariffs on electronics have been temporarily lifted, and looser conditions for the auto industry are under consideration. These moves triggered a positive reaction —

Ekaterina Kiseleva 11:29 2025-04-15 UTC+2

Apple surges, market freezes in anticipation of Netflix: what's happening in the US stock market

US stocks show modest gains as tariffs on some electronics are delayed Tech stocks outperform European and Asian ones, Apple shares jump Goldman Sachs rises after results More earnings expected

Thomas Frank 09:50 2025-04-15 UTC+2

US Market News Digest for April 14

The US stock market rallied after President Donald Trump announced the removal of tariffs on computers and smartphones. The decision delivered a particularly strong boost to companies such as Apple

Ekaterina Kiseleva 12:09 2025-04-14 UTC+2

European chipmakers rejoice as US lifts stocks

A rally in tech stocks helped lift European shares on Monday after US President Donald Trump granted exemptions to Chinese tariffs on smartphones and computers, giving markets a break after

Thomas Frank 11:14 2025-04-14 UTC+2

US Market News Digest for April 11

After Wednesday's explosive rally triggered by President Donald Trump's announcement of a 90-day tariff pause, US markets on Thursday decided the party was premature. Major indices tumbled: the Dow dropped

Natalia Andreeva 15:28 2025-04-11 UTC+2

Rollercoaster: S&P 500 down 3%, gold hits all-time highs

US stocks fall after Wednesday's events, S&P 500 down 3% European and Asian stocks close higher after Trump suspends most tariffs Bond market rally stabilizes, gold prices hit all-time highs

Thomas Frank 09:44 2025-04-11 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.