Good evening, I’m reporting on the latest developments from Federal Reserve Chair Jerome Powell’s semiannual testimony to Congress. Powell sent mixed messages to investors on Tuesday, stating that the central bank doesn’t plan to cut interest rates until they have more confidence in inflation moving towards 2%. Despite the decrease in inflation readings from previous years, Powell emphasized the need for more positive data to strengthen their confidence in reaching the 2% target.
During his testimony, Powell was questioned about White House politics, which he skillfully avoided. Former President Donald Trump’s comments about Powell not being reappointed if he were to be elected again added to the political tension. Powell underscored the independence of the Federal Reserve, stating that they operate independently to focus on long-term economic goals.
In addition to inflation, Powell indicated that there are other risks to consider in monetary policy, hinting at a potential recalibration of policy. The slowing US job growth in June raised concerns about the timing of rate cuts that could impact the economy. Despite this, Powell’s acknowledgment of the potential negative impact of ongoing high-interest rates on the economy did not spur significant market reactions.
Investors remain skeptical about the Fed’s future decisions, with a focus on upcoming CPI data to gauge progress against inflation. Powell emphasized that every Fed policy decision is made using the latest data available, hinting that the September Fed meeting could be a crucial turning point. While most investors expect rates to remain unchanged in July, opinions are divided for September.
Powell’s packed schedule includes continued congressional testimony and appearances at events discussing the state of the US and global economy. Meanwhile, in a separate development, a victim of hidden camera surveillance at an Airbnb rental property shed light on the company’s handling of such cases. Despite numerous customer support tickets related to hidden cameras, Airbnb’s failure to protect guests and privacy remains a pressing issue.
Lastly, Boeing’s recent sales figures showed a decline from previous years, with only 14 new jets sold in the past month, mostly freighters. Sales have dropped significantly following incidents such as the door plug blowout on a January flight, leading to hesitation among airlines in expanding their fleets. This challenging sales environment has led Boeing to focus on resolving issues to regain market confidence.
