NEW YORK, USA – An index of global stock markets fell, while short-term US Treasury yields rose on Friday, August 26, aftersaid the US economy will need tight monetary policy “for some time” before inflation is under control.
Tight monetary policy “for some time” means slower growth, a weaker job market, and “some pain” for households and businesses, Powell said in a speech to the central banking conference in Jackson Hole, Wyoming. He did not hint at what the Fed might do at its upcoming September 20-21 policy meeting. Officials are expected to approve either a 50- or 75-basis-point rate increase.
“It was hawkish as expected. Powell’s message is clear: the Fed is far from done in its fight against inflation,” said Antoine Bouvet, senior rates strategist at ING in London.Wall Street’s main indexes fell, with Powell’s comments dragging down megacap growth and technology stocks.