Stocks fall after Fed officials temper hopes for a rate cut
Stocks fell Tuesday after comments from the top Federal Reserve official raised questions about whether the central bank will cut interest rates next month.
The Dow traded 100 points lower, while the S&P 500 lost 0.6% and the Nasdaq dropped 1%.
Fed Chair Jerome Powell said the central bank is assessing whether current economic uncertainties call for lower rates. The central bank also believes U.S. inflation will return to 2%, albeit at a slower pace than expected, Powell added. He also said the Fed remains independent of “short-term political interests.”
James Bullard, the president of the St. Louis Fed, poured cold water over the idea of a half-point rate cut prior to Powell’s remarks.
Just sitting here today I think 50 basis points would be overdone,” Bullard, the only FOMC member to dissent on the Fed’s decision last week to keep rates unchanged, told Bloomberg TV. “I don’t think the situation really calls for that but I would be willing to go to 25 ... I hate to pre-judge meetings – things can change by the time you get there – but if I was just going today that’s what I would do.”
Bullard and Powell’s comments added to the session’s negative sentiment, which was sparked by the weakest consumer confidence reading in more than 1½ years.
https://www.msn.com/en-us/money/markets/stocks-decline-after-weak-consumer-confidence-report/ar-AADo6Nj
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