Fed signals shift to inflation focus, stoking market concerns
Despite Fed chief Jerome Powell’s denials, stocks drop slightly following the central bank’s policy statement, which was interpreted as a hawkish shift
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US STOCKS fell after a slight change in the Federal Reserve’s statement on Wednesday (Jan 29) was interpreted as a hawkish shift, despite chairman Jerome Powell’s denials.
While the Fed kept its benchmark rate unchanged between 4.25 and 4.5 per cent, a new tone in the accompanying policy statement stirred market concerns.
The central bank removed a reference to a cooling labour market that had featured in several previous economic updates. In its updated assessment, the Fed said unemployment had “stabilised at a low level”.
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