Powell Faces New Risks as Fed Chair

Federal Reserve Chairman Jerome Powell’s embrace of his predecessor’s gradual approach to tightening monetary policy is about to be tested.Since Powell accepted President Donald Trump’s nomination almost four months ago, the near-term outlook has changed significantly.Jerome PowellPhotographer: Andrew Harrer/BloombergFinancial volatility has awakened, and a booming stock market has shown it can also go down. A $1.5 trillion tax package is adding stimulus to the U.S. economy at a time of very low unemployment and solid growth, a trend that could red-line demand and kick up a central banker’s worst enemy — inflation. The government wants to test the limits of the world’s appetite for its debt, a boost in supply that’s putting upward pressure on market interest rates.

Source: Powell Faces Policy ‘Combativeness’ in Riskier Post-Yellen World – Bloomberg

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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam