In his testimony before the House Banking Committee, US Federal Reserve Chairman Jerome Powell admitted for the first time that inflation without the phrase is temporary, which he has always repeated when asked about inflation, acknowledging that inflation continues to rise more and more.
In his testimony, Powell indicated that it is appropriate to talk about accelerating the process of gradual tapering of asset purchases at the next meeting on December 15, ie two weeks from now.
This talk comes as a surprise to the markets from Jerome Powell, who has always held the stick from the middle, but to say it explicitly that the plan to withdraw purchases from the market must be accelerated means that we will see an increase in interest rates as soon as possible next year, even if he did not explicitly say it.
The US dollar reacted positively to these statements and rose by more than 1%, as the general index of the US dollar is trading at 96.32 levels, after it had lost about 0.70% before these statements.
05/11/2024
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