The stock market rallied strongly on Nov. 28 as Federal Reserve Chairman Jerome Powell made a dovish comment. Powell said that rates are “just below” the Fed’s targeted neutral level, which most Fed watchers consider to be 3%. This came after Powell called rates a “long way from neutral” on Oct. 3, provoking a major reaction in the financial markets.
Wall Street read his latest remark as a signal that the once-a-quarter rate hikes will stop sooner than expected. The Fed plan was to raise rates four more times. We expect hikes for sure in December and March, and likely in June. But the September 2019 hike looks to be off the table.
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