#PowellRemarks Advertised about inflation, the markets simply yawn
Federal Reserve Chairman Jerome Powell conveyed a clear and concise message to the markets on Wednesday just before 3 p.m. (Eastern Time): some inflation is expected soon.
Some stocks suffered a momentary sell-off, more or less. But ultimately, the market shrugged. At 3:30 p.m. (EST), the Dow and S&P 500 were trading volatilely and sideways. The latter, a leading index, seems to enjoy staying a few points below 6,000 points. It wouldn't rise much more. By the close on Wednesday, the S&P 500 recorded a slight loss of 0.03%.
Bitcoin, which is struggling to determine whether it is a risk asset or a hedge against inflation, remained stable on Wednesday around $104,000, 4% less than a week ago. BTC has dropped 7% from its all-time high of $111,814, reached on May 22, according to CoinGecko.
"Everyone I know is forecasting a significant increase in inflation in the coming months due to tariffs, because someone has to pay for them," Powell said during a press conference yesterday after the conclusion of the Fed's June meeting, where interest rates were left unchanged.
Meanwhile, the conflict between Israel and Iran has created an additional layer of clouds over a dense fog related to the trade war. Regarding U.S. intervention, President Trump had still not made a decision as of last night.
Despite the magic potion that could lead to slower growth and higher prices — particularly at gas stations if the war in the Middle East extends — the Fed still maintains expectations about the possibility of two rate cuts this year.
