Fed's Bowman said December rate cut was 'last step' in 'policy recalibration'
Published On Jan 9, 2025, 2:41 PM
Federal Reserve Governor Michelle Bowman indicated that the recent interest rate cut in December was the final step in the central bank's policy recalibration. She expressed concern about the lack of progress in reducing inflation and signaled a preference for a cautious and gradual approach to future monetary policy adjustments. Bowman highlighted the risks of stagnant inflation and emphasized the importance of evaluating incoming data to guide the central bank's decisions going forward.
Stock Forecasts
XLF
Negative
The Fed's cautious stance on monetary policy could introduce volatility in financial markets. Investors may react negatively to the potential for further policy adjustments if inflation does not improve. This cautious approach might lead to reduced risk appetite in the equity markets, particularly in sectors sensitive to interest rates.
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